Colombia Continues Its Crypto Journey, Kings of Leon Embraces NFTs, IRS Making a Crypto Exemption, BTC Still Struggles
In this edition:
- Colombia’s Crypto Tale: Banks Piloting Crypto Services
- Kings of Leon’s New Album to Be Sold as an NFT
- IRS: No Tax Reporting for Buying Crypto With Fiat, But…
- BTC’s Struggles With the 50k Line; March Edition
My dear fellow Anchorians, hi! Don’t worry, I haven’t forgotten you… or the latest crypto news. Anchor’s Crypto Roundup will be published biweekly now, so we’ll see each other every other Friday!
So, a lot of things have happened during these two weeks – e.g. BTC’s turbulent price movements. But we’ll get to that shortly. In this 81st edition, we’ll talk about Colombia’s most recent efforts to utilize cryptocurrencies, NFTs as the big rising trend, IRS’ dos & don’ts, and of course BTC.
Though we’re still uncertain where these times lead, we try to make the most of them. And our dear crypto community never fails to bless us with interesting news and events. Okay, okay, I know what you’re thinking – let’s dive right in!
Colombia’s Crypto Tale: Banks Piloting Crypto Services
Colombia has proven to be a true crypto pioneer in Latin America – in some of the previous Roundups, we talked about the government’s national blockchain strategy, crypto transactions regulatory sandbox project, and a significant increase in BTC ATMs in the country.
So, the latest news comes as no surprise. The oldest bank in Colombia, Banco de Bogotá, will now pilot crypto services as part of a regulatory sandbox project mentioned above.
The pilot program is directed by the Superintendencia Financiera de Colombia, which is the highest financial regulatory body in the country, and this project will be run within a regulatory sandbox named la Arenera. (For the curious ones, la arena means sand in Spanish, and la arenera is literally the sandbox.)
How does it work? Well, a selected group of clients will be able to buy and sell cryptocurrencies from the bank with the national fiat currency (peso). Oscar Bernal Quintero, VP of technical development at the Bank said:
“One of our great motivations is to be an active part of the transformation of the country and we consider it valuable to participate in the construction of the possible regulation that would enable the exchange of crypto assets within the Colombian regulatory framework.”
Again, Colombians want crypto – the country of magical realism is still no.1 by the BTMs in the whole continent. Instead of banning it, Colombia’s government is trying to learn more about crypto and adjust its policy and laws from a perspective of knowledge and data. Kudos!
Kings of Leon’s New Album to Be Sold as an NFT
This NFT is on fire! Oh, maybe this should’ve been the title. Anyhow, yes, Kings of Leon is releasing a new album, the first one after four years, and it will be sold as an NFT!
In case you’re new to this world, here’s an explanation of what an NFT is: A non-fungible token (NFT) is a special type of cryptographic token which represents a unique asset; non-fungible tokens are thus not mutually interchangeable. Ownership of these assets is recorded on a blockchain.
Famous American rock band decided to do something different for their 8th studio album dubbed When You See Yourself – to release it in the form of an NFT token, dropping three types of tokens as part of a series called “NFT Yourself”.
The album will also be available on traditional platforms such as iTunes and Spotify, while the NFT version will be available on a decentralized ticketing platform Yellowheart. These three series are designed to offer fans unique products and services, e.g. special album package, front-row seats for life, audiovisual art.
At the price of $50, one NFT token includes extended media such as alternate album cover and limited-edition vinyl.
Yellowheart’s CEO, Josh Katz, says NFTs will ‘’make modern fans want to own music again’’. And it’s true, there is something surprisingly ‘’vintage’’ in buying music via NFTs, however modern the solution.
IRS: No Tax Reporting for Buying Crypto With Fiat, But…
Yeah, IRS and crypto… It’s a complicated relationship, to say the least. However, the Internal Revenue Service shed some light on the issue by saying it ‘’will not require crypto investors who simply bought “virtual currency with real currency” in FY2020 to report that transaction on this year’s tax returns’’.
“At any time during 2020, did you receive, sell, send, exchange, or otherwise acquire any financial interest in any virtual currency?” question in the annual 1040 form has an official exemption – e.g. if just you bought a certain amount of BTC for dollars, that action doesn’t trigger tax reporting.
Nonetheless, if you traded crypto for crypto or received an airdrop, the situation changes and you have to check the box.
“Quite frankly, buying cryptocurrency using USD is not a taxable event. So, I don’t see any reason why taxpayers have to disclose that to the IRS by checking the box,” said Shehan Chandrasekera, head of tax strategy for CoinTracker.
This scenario is very limiting for crypto investors since it leaves them without hedging options. If BTC enters a bear run, they can’t sell bitcoin, for example, a stablecoin. Crypto transactions are simply different than fiat transactions, and the current 1040 form doesn’t cover peculiar details.
American crypto investors still aren’t sure how to disclose their gains and losses yet they know that not disclosing is illegal.
BTC’s Struggles With the 50k Line; March Edition
Price correction, support, resistance… After a few months of simply soaring and constantly reaching new all-time highs, BTC price is now struggling to stay over $50,000.
At the very end of February, BTC dropped to just over $43,000 and is still fighting to surpass $50,000. It did for a short time, but 50k continues to be a resistance, instead of a support line. At the moment of writing, BTC price equals $49,270 (CMC).
Some traders thought a new bullish trend was ahead of us since bitcoin regained value after the dip, but we can’t say anything for certain. Yes, people rushed to buy the dip, but trading volume soon decreased.
ETH took the blow, too. After surpassing $1,800 for the first time, the price later went back to $1,500. Quite a turbulent end of February and the beginning of March for the most famous cryptocurrencies.
Nonetheless, the signals aren’t announcing a bear run either. We’ll see how the market will respond to these turbulences and if 50k, also an important psychological barrier, can be overcome successfully.
This is the end, my only friend, the end.
I mean, not really, but I believe this Roundup deserved a little bit of The Doors. We talked about rock artists turn to NFTs, after all!
So, a lot of interesting events in the crypto industry emerge every day, but we’re making sure to keep up. As you learned at the beginning of this 81st edition, our Roundups will be now published biweekly, which means I’ll see you in two weeks, my fellow Anchorians.
Alas, I wish you fair winds and the following seas! Stay safe and take care.
Disclaimer: The information provided in this post is not legal, accounting, or financial advice. I am not a lawyer, accountant, or financial advisor. I am not registered as an investment adviser with any federal or state regulatory agency. The Information should not be construed as investment or trading advice and is not meant to be a solicitation or recommendation to buy, sell, or hold any cryptocurrencies.