G20: Bitcoin is not a currency but an asset

No new regulations. That was the tenor. Now a document has leaked out that could classify crypto currencies as assets rather than currencies.

The document states that digital currencies „have no characteristics of state currencies“ and should therefore be considered as assets. As a result, digital currencies could be subject to capital gains tax.

Up to 35 percent taxes
The taxpayer could have to pay up to 35 percent tax:

Up to 35 percent taxes with Ethereum Code

The capital gains tax is […] between 10 and 35 percent, depending on the type of capital income depending on Ethereum Code plus solidarity surcharge. For example, the capital gains tax is 20 percent for dividends, 30 percent for interest payments (so-called „interest income tax“) and 35 percent for table transactions. In the case of dividends in old cases, it should be noted that the capital gains tax must already be paid with the inflow to the shareholder.

Following a classification as an asset, the amount of the taxes and the category of gains from crypto currencies would have to be clarified.

Crypto currencies no state currencies
Klaas Knot, president of „Nederlandsche Bank NV“, said:

I don’t think any of the crypto currencies do the three things that state currencies do in an economy.

Christina Lagarde, Managing Director of the International Monetary Fund (IMF), also recently called crypto currencies „crypto assets“.

Private investor for Bitcoin Revolution

If crypto currencies were regarded as assets, this would run counter to however Bitcoin Revolution is great the decision of the European Court of Justice from 2015, which Bitcoin classified as „real money“ and even „equated“ state currencies.

It remains to be seen what decision the G20 summit will reach and whether crypto currencies are to be classified as assets. At the moment, however, immediate action seems unlikely.

For the private investor this would probably be a horror scenario, after crypto currencies were tax-free for years after a one-year holding period.

Probably the digital currencies will then follow the regulations of securities. Until 2009, shares were also tax-free for private investors after a one-year holding period. However, if shares were bought before 2009, these were considered to be old holdings at least until today and did not have to be taxed. However, this regulation has now been lifted for fund investors with long-term investments for amounts in excess of € 100,000. Old portfolios for funds no longer exist and profits from earlier „old portfolios“ must also be taxed.

Regulations, regulations, regulations
The trend of regulation continues and so does the fear of over-regulation. The problem, however, is not that crypto currencies are regulated, but how they are regulated.

Authorities and committees misinterpret crypto currencies as currencies. It is understandable that these non-state currencies can be equated. Nevertheless, they serve as means of payment and digital currencies are more than useful, especially for the online sector.

The Bitcoin price fell further back

Bitcoin, Ethereum and Ripple – Price analysis 10.07.2018

The Bitcoin price fell further back, breaking through support levels of $6,680 and $6,600 respectively.
The trend line with resistance at $6,700 on the hourly chart is intact
BTC must stay above support level of $6,550 to avoid further declines in the short term
Technical Indicators Signals
The Bitcoin price began a downward move from the $6,840 high. BTC dropped back and breached the support level at $6,700. On the other hand, there is a bullish trend line with support at $6,560 on the hourly chart. If Bitcoin breaches the support level of the trend line at $6,550 an ounce, there is a risk of further price losses. Below this level, the price could potentially move towards $6,500 and $6,450 an ounce. On the bullish side, the $6,700 resistance must be breached to regain momentum.

Bitcoin Chart from TradingView

Bitcoin Price Analysis

Looking at the chart, yesterday’s trend line is intact. A break above $6,700 is necessary to initiate a recovery. The nearest resistance zones are $6,750 and $6,800. The MACD is strongly in the bearish zone. The RSI is moving towards 20 and reaching oversold conditions, reflecting the exhaustion of sellers and allowing Bitcoin to correct slightly higher in the near future. The important support level is at $6,550 an ounce, while resistance is at $6,700 an ounce.

Ethereum Price Highlights
The ether price fell sharply and broke an important support at $478 an ounce
Yesterday’s important bullish trend line with support at $476 on the hourly chart has been breached
ETH now trades well below $475 support and 100-hour SMA
The Ethereum price made a strong downward move. ETH may fall further if sellers keep control below $475 an ounce.

Technical Indicators Signals

A new correction wave was triggered from the $496 high. ETH could not maintain the important support level at $475. Ether fell sharply and is below the $475 support and 100-hour SMA. Yesterday’s important bullish trend line with support at $475 on the hourly chart was breached. It appears that the recent break below the trend line and the 100 SMA has pushed the price back into a bearish zone. A break below $460 could mean a drop towards $450.