The US Treasury Department has proposed new tax rules for crypto exchanges, hosted wallet providers, and payment processors, requiring them to meet tax reporting obligations, while exempting miners and some decentralized finance platforms.
The U.S. Treasury Department's new proposal on digital asset taxes is facing criticism from the crypto industry, as it may capture decentralized operations that are difficult to comply with, although it may also provide a clear path for crypto investors to file their taxes.
The proposed cryptocurrency tax regulations by President Joe Biden are causing concern among many in the cryptocurrency community, with critics arguing that these measures could stifle innovation and progress within the US, while other countries outperform in this realm.
Indian Prime Minister Narendra Modi has called for global collaboration on formulating crypto regulations during the annual G20 summit, advocating for a comprehensive global framework for regulating cryptocurrencies despite India's own lack of regulatory clarity and high taxation.
The Financial Stability Board and International Monetary Fund are releasing a joint paper at the G20 Summit that outlines a roadmap for global coordination and policy frameworks for cryptocurrencies.
A policy paper prepared under India's G20 Presidency recommends licensing crypto service providers and implementing anti-money laundering standards in the sector, while cautioning against an outright ban on cryptocurrencies due to their borderless nature. The paper also addresses concerns about stablecoins and their potential impact on financial stability.
Crypto exchange Coinbase plans to focus on non-U.S. markets, including the European Union, the United Kingdom, Canada, Brazil, Singapore, and Australia, due to their clearer crypto laws, as it seeks to expand its operations and establish partnerships with global and local banks and payment providers while ensuring compliance with governance systems. The company also aims to intensify its lobbying and visibility efforts ahead of the EU elections and engage with the G20 to create global crypto standards.
G20 leaders have agreed to implement global tax reforms encompassing digital economy taxation and a global minimum corporate tax rate, with significant progress already made on the first pillar and a Multilateral Convention (MLC) expected to be ready for signature in the second half of 2023. Additionally, the leaders called for the swift implementation of a Crypto-Asset Reporting Framework (CARF) and the regulation of crypto-assets activities and markets.
The leaders of the G20 countries have called for the swift implementation of a cross-border framework for crypto assets that would facilitate information exchange between jurisdictions starting in 2027, aiming to give tax authorities greater visibility into crypto transactions.
G20 leaders have committed to reforming the dysfunctional World Trade Organization's dispute settlement system by 2024, aiming to improve global trade and reduce protectionism.
The G20, including U.S. president Joe Biden, has endorsed the Financial Stability Board's recommendations for regulating cryptocurrencies, which could have a significant impact on the prices of Bitcoin, Ethereum, BNB, XRP, and other major cryptocurrencies.
The G20 summit in India is expected to deliver a group agreement on the need for stricter global regulation on crypto assets, but the underlying fractures and shifting allegiances may render the focus more noise than substance.
A global tax convention to tackle tax avoidance by multinational corporations, including tech giants, is expected to be signed by 138 countries by the end of the year for implementation in 2025, along with a separate framework enforcing a 15% minimum global corporate tax rate.
