Bitcoin Forum

It's just YouTube, but today I ran across a video that mentioned a bitcoin HODL tax.

In order to stop bitcoin, authorities would have to shut down the internet which is impossible. So I predict that their next move is to launch enormous taxes to discourage people from owning bitcoin, and prevent mass adoption as competition for their corrupted CBDC's that still have to be launched. The purpose of their regulations is to take over the entire bitcoin market, of course. They will make you sell, either by launching huge taxes for ownership or by treating the owner of 1 BTC like a drug dealer (prison sentence).

So we need a gameplan against this.

Can we be exposed to taxation or legal penalties when the wallet is reported as stolen? I think not, but I want to be sure.
I don't think you can pay taxes on something you do not officially own. And neither can you pay taxes when you don't have money or own other assets.

I have purchased my first BTC on a regulated exchange with KYC. I don't prefer it because of privacy reasons, but I had no other choice at the time. From there it will go to my coldstorage device, which I consider reporting as stolen if a ownership tax is launched. However, authorities would know the BTC address (exchange will provide it) and every future transaction that came from it. So I could never move the funds after reporting it as stolen (I guess) as this demonstrates they were not stolen.

Can I transfer the BTC from my current address, to an address that no government can ever link to me?

lets compare  to other things that have property tax just for ownership
real estate property tax is only applied due to ongoing municipal costs of the streets around the real estate. things like pot-holes, landscaping, electrifying the streetlamps and traffic lights aswell as other public services

there is no monetary loss to government for someone owning bitcoin. there are no government maintenance costs involved
the only tax they "should" legally charge is capital gains. but this "should" be on realised gains upon a sale, not equity value increase per year

Unless you use a DEX to swap and exchange bitcoin for other coins like Monero and then use another wallet to buy and receive bitcoin, the wallet will still be linked to the address that you send it to. If you ever want to trace that transaction, let's not forget that it's a public blockchain and transactions can be tracked by anyone who has access to the address on the blockchain.
 
There are means to clean up coins that you have already bought from the centralized exchange; either you can exchange them anonymously or you can send them back to the centralized exchange where you bought them and exchange them back to Fiat, where you can later use the fiat to buy from Dex P2P, where one will know what the funds were used for and only you will know what address and the amount of bitcoin that you hold.

I think this is pretty ridiculous and there's no chance of this ever happening.  I guess it's never a bad idea to think about all sorts of different possibilities that there could be coming with owning bitcoin, but, I just don't see this one ever coming to fruition.  I mean how would they even go about tracking everyone down and holding them accountable? 

Also, if they ever come to tax my bitcoin that I'm simply hodling, I will let them know they can suck it out of the tip of my ... yeah.

It is pertinent to note that all these unscrupulous shenanigans by government and its arms are just a way of getting at Bitcoiners and they are only enjoying their limited time as Bitcoin gradually gains adoption. Uoon massive adoption, people will prefer to use Bitcoin thereby activating its peer-to-peer feature which entirely eliminates the government from interfering or taxing transactions that doesn't involve their traditional finance systems.

What I personally predict for the future, although I am not sure:

"We must prevent the convertibility of US dollars to bitcoin, to protect the monetary stability of our banking system" --> This would be a copy of Nixon's speech in 1971, when he denied the convertibility of USD to gold. Do not forget that banks are vulnerable to liquidity. If people start pulling out their savings because BTC reaches a new ATH, banks get very nervous. Your savings are lent out to someone else and they hate to let them go.

"We must stop terrorists and money launderers, who always use bitcoin for their illicit activity". In fact I have already heard this line multiple times from people like Elisabeth Warren and Gary Gensler. It's a BS argument of course. JP Morgan was buying up all BTC while Warren said this in congress. All they want is complete ownership of the BTC market.

I strongly believe they will do it by creating maximum sell pressure. 1) By dumping the price and scare people into selling, 2) By launching enormous ownership taxes, 3) By making it illegal to buy it. They want control, and they will not allow us to own anything they don't know about

If this happens in your country, you can come to Portugal.

Here, taxes are only paid on gains, relating to buy/sale made in the last year.
In other words, if I sell Bitcoin purchased in 2022, I will not pay tax. But if you sell Bitcoin purchased in 2023, you will already pay tax.

That's why it's the "ideal country" for HOLD.  8)

If the fund is coming from an exchange and you do a normal transfer then the government can easily track the owner of the Bitcoin funds unless you use a privacy coins.

I do not think that it is reasonable for the government to impose tax to those who are just holding Bitcoin.  As far as I know only transaction that yields profit are taxable.  Those trades where the trader losses are tax exempted so as long as your Bitcoin holdings does not give you a profitable transaction there is no way the government will impose income tax on it.

Thanks a lot for this. Throughout 2024, this is what I will have to look into.
I'm a medical student and the director of the school likes to brag about his finances. His lawyer has inside information about my country launching much higher taxes on most assets people own privately. Even though he is a multi millionaire, he owns nothing privately. Most assets are registered as part of business. He already mentioned that at some point he is looking to move abroad because what he does now is no longer sustainable.

After marriage I will have dual citizenship (1 EU, 1 non EU), which I think is very valuable when the government tries to go after BTC with tax robbery.
I do wonder if their ownership tax plan will cause a collapse of the markets. If you can't exchange BTC freely or use it as a means of payment, that has to crash the price.

It's the same in my country, but that may change soon.

I'm planning to take profits after this bull run, but taxes in my country are huge. The centralized exchange will provide my government with my transaction history as soon as they are asked about it.

Can I avoid this with DEX?
I know a guy who has already collected multiple BTC. He took profits on regular occasions and he doesn't want to leave the profits on an exchange, of course. So he opened bank accounts in 2 other countries. He was already contacted by our government. They immediately know. Unless you are a millionaire based in Dubai or Switzerland, where the law does not force banks to share information with your homecountry.

I always considered buying crypto a one way street. You can deposit from banks to exchanges, but as soon as you go from exchanges back to banks, it alerts the tax thieves and they will go after your transaction history.

I considered options like stablecoins but these are risky as they are under attack.
I've also heard that privacy coins like Monero are under government attack, being forced to be delisted.

I wonder who will win the battle. But there is hope

1.  The government does not want to shut down bitcoin I don't know where you got that from. They approved 11 Bitcoin ETF's a couple days ago.

2.  Yes, you can buy on a KYC exchange and then transfer the funds to an address that the government cannot link you to. Use the bitcoin address of any non-custodial wallet of your choice. You will not get taxed until you move it from that Non-KYC wallet back to an exchange to sell.  That's the best way to go about it in your situation. Reporting anything stolen won't help you.  

Well I want to take profits after this bull run. Imagine I invest 20k and it shoots to 100k. The 80k "profit" will be converted to fiat on the exchange, but it will be reinvested when I think the time is right. But under the current law in my country, I would have to pay more than 50% of taxes on this profit so that totally eats up the amount to reinvest. I can never expand my BTC portfolio when the government takes more than 50% of every withdrawal. That is not just a tax. That is legalised confiscation of assets.

whats  the sense of the tax in a decentralized system? If my understanding on the system of taxing isn't wrong, using the regular bank as an instance, government only impose tax in institutions like banks and not the user of the banks. What we pay for using the bank is basically bank charges while the banks are held to pay tax.

since bitcoin is a decentralized system that, who will be responsible for the payment of the tax?

Is it Satoshi? Or thymos?

I don't see this happening to b honest and if we are looking at tu possible strategies that the government can impose on bitcoin use to make it fall under government regulation then we should be talking about creating something like a bitcoin bank or stuff like that which has a physical presence

BTC by its very nature precludes centralization, and thus governments. They can attempt to do whatever they want. BTC will fill the cracks of attempted centralization like water seeking its level.

I don't know about other countries but their is no government tax for individuals holding Fiat, although banks takes their charges depending on the bank but the government don't directly charge the individual for holding Fiat in my country so why should someone pay any tax for holding Bitcoin.
If there is any tax in that regards then it's an infringement to the person's freedom and right. Holding Bitcoin is not in any way the concern of the government and also Bitcoin is decentralised and no government, or institution can forcefully take your Bitcoin if saved in your personal wallet.

Government don't care whether we gain or lose in Bitcoin or crypto in general and rather they are more focused on discouraging people from using crypto and I am not sure if you are aware but Indian government has already applied a atrocious tax on crypto and even 1%TDS on every transaction and even if you want to make a trade you gotta pay the tax which eats up the profit and this has been implied over Indian based exchanges thus literally killing Indian exchanges are people have shifted to international exchanges like Binance but now they have pressurised Apple to remove apps like top centralized international exchanges from App store. If Indian government has done it then any government can do this. Need to have back up plans

If the government launches taxation on Bitcoin holders, I don't think they can possibly make every Bitcoin holder pay such a tax. The reason is that some people have already stored their Bitcoin in a cold wallet, and those holders are definitely keeping their hardware wallet safe in a place where only they can reach it.

So, the government cannot actually determine everyone  owing Bitcoin unless they work in collaboration with centralized exchanges to identify users who have passed KYC on those exchanges, and the exchange can further help them get details on the amount of Bitcoin that the investor has purchased. That's a reminder to every Bitcoiner to note that KYC is actually a trap that the government might use any time they want to get to Bitcoin users. Not only the government, but scammers and hackers can also take advantage of a user's personal details obtained from KYCs.

Also, if this kind of law is passed by the government, it definitely will not affect all countries in the world; people can move to a crypto-non-taxing country and carry out their crypto activities there.

If they want they can and nobody can actually stop them but it won't be fair just to impose such kind of tax especially for crypto alone so they have to follow same thing to stocks too and if that happened then every billionaire has to pay millions of dollars to the government so they will not be in support of such taxation which means that kind of taxation will not be imposed.


Yes, you can via mixing the coin which can help with breaking the links between your origin address and destination.

In my country have adopted with tax of cryptocurrency almost one year but we can manage well transaction in global exchange and sell to fiat trough P2P exchange on binance or other exchange have supported with P2P. Actually not comfortable position when have to pay taxes for cryptocurrency transaction but its not much problem if your country have been legal using bitcoin or altcoin as payment transaction.
Have problem in my country bitcoin or altcoin is not legal digital currency payment but we have to pay taxes on every time transaction with local exchange market for buying and selling order.

You have way how to stop from cryptocurrency tax, check global exchange in your country not adopt with tax and trade there for selling or buying bitcoin then you can withdraw trough P2P exchange for getting fiat fund.

The term refers to taxes incurred when holding spot Bitcoin ETFs and not the real bitcoin as mentioned in this YouTube video (https://www.youtube.com/watch?v=5r_Mk32rWac)

If you live in the United States, there is already a tax on the profit you make from any bitcoin sold. If you buy your bitcoins at $400 and sell at $500 on centralized exchanges Binance, Coinbase and the others, they are bound by the law to report this gains to the IRS. The only gameplan against this is to evade the tax by selling your bitcoin on a decentralized exchange. To pay less tax on bitcoin capital gains, consider a long-term capital gains than short term capital gains.


Like I have said earlier, you are only taxed on bitcoin sold at a profit.

The joy of it all is that, government have no control over citizens assets such as Bitcoin since there are no direct depends on any of government control services or facility just like we have with other assets of their class such as real estate that depends alot on government service's such as electricity and water to run the business such business are easily taxed since it involves fiscal gained taxes, but assets such as Bitcoin or gold that doesn't require any of such services to run it business or ownership, will not be put so much under such taxation.


Although I'm some cases, you still will end up paying indirect taxes on such asset's but this will only be applicable at the points of exchange for goods and services such as (VATs) value added taxes so much other taxes that exists in the financial system through government micro economics facility.


But tax on Bitcoin ownership is what we may likely not see since the internet is the host and government have no control of the internet and your Bitcoin assets have no requirement for whatever government service's unless you are a Bitcoin number which is not what we are discussing here.

In order to stop Bitcoin they could simply close all the centralized exchanges and order banks to freeze Bitcoin-related transactions. But instead they just approved Bitcoin ETFs. Where's the logic in that? They hate Bitcoin so hard that they will allow institutions to get involved with it? Or maybe, just maybe, they don't really care about Bitcoin, and CBDC is just a thing a few low-rank people from the government talk about to make it seem like they do some progress.

The only way the governments can impose a tax on Bitcoin is through taxing the centralized services that we make use of with Bitcoin. They can't tax Bitcoin directly or any decentralized service that the community uses. The governments can only know you won Bitcoin when you buy from a centralized platforms that they have control with the data they have on you. If the government were to introduced a taxation it'll only encourage the Bitcoin community members to be using Bitcoin in a more self custody way and not relying too much on centralized services providers as we have been doing with CEX and wallet providers.


Yes there are various ways to do that, let say your current address has already been tagged, you can use exchanges that don't need kyc for small transactions or make use of casino that don't need kyc for small withdrawal to clean you Bitcoin and get a new one that isn't linked to you with a new Bitcoin address. There are other ways that if you Google you'll find. You can also send Bitcoin to a new address and only use the Bitcoin on the new address with decentralized services so it doesn't get trace back to you owning it.

Well, I know an asset class where you are taxed barely by holding. It's called fiat money. And the tax is inflation. Do people still use fiat money?

Yes you can do that but for that you'll have to first download bisq application and swap your Bitcoin with a privacy coin like Monero. Once it's done then you will have to swap Monero back to Bitcoin and create your own personal wallet using a open-source wallet software like Electrum. After that you'll just have to withdraw your new Bitcoin in that wallet and as long as you don't tell anyone about your wallet, the government or anyone else won't be able to link that wallet to you.

I would say a simple way is to move to a country where the citizens don't have to pay tax for Bitcoin holdings. If you can move to a crypto-tax free country then you'll never have to re think about the taxes on Bitcoin. There are some good countries that don't tax the Bitcoin holders like UAE, El Salvador, Switzerland, Singapore, and a few other countries.

taxing it is legitimising it but not regulating it..
they want to regulate it. and put CEX spot in a higher annoying category to get than an ETF. to draw attention and customers towards ETF

ill just post this. it will make sense to how things are done in the markets

Maybe it's possible if you use a DEX platform. Because if centralized exchange is used for sure, you can really question it. I'm just not that familiar with P2P on a DEX platform. Because there are often fast p2p transactions on the CEX platform, right?

I also experienced someone like that who transferred a large amount, and then the local exchange questioned the amount of bitcoin that was transferred to their platform. The worst part is that they hold my account until I complete the requirements they ask of me.

This is indeed worrisome and devastating ought to be brainstorm about. Even though it may just be a mere thought of imaginations, there is every autocratic flexible tendencies of the manifestation of this fact.
If a certain government authorities would have the impetus to place Bitcoin and the AltCoins on a banned while some places it on illegal inventory technology, then such as OPs figures of mindsets could also be possible to a realistic.
Despites the decentralization of Bitcoin in a Blockchain, if the governmental authorities wants to indicts any of the Bitcoin investors with any charges or either falseful accusations, the individual wouldn't have the momentum to tackle the condition because the government itself is POWER.

Well, if that's the case then I'll just hide my bitcoins somewhere that's not connected to the Internet, my wallet doesn't have my identity anyway, long as they can't track that it's me that have that address and that I'm swapping it for USD or local currency then I don't think that I'll have any problem if they do that taxation thing, also you can just swap it for USD in this forum and get it online through PayPal or set a meetup to help to do a physical exchange or just read the details about the taxation and see if there's a loophole where you can sell, buy, store and transfer bitcoin, when it comes to taxation it's most likely that they're going to only ask for taxes when there's some form of exchange and I don't know about any country out there but I'm sure that in my country, there's a possibility that they won't tax you at a certain amount so use that potential loophole if it ever happens and hopefully we never get to see this ever happening.

All the addresses at first are anonymous, usually they can be related to you if, for example, you move bitcoin to and from an exchange where you did the KYC, in that case it would be pretty easy to link that address to you. And let's say this is your case, now you have the bitcoins in your wallet, if you move them to another wallet you may say that is not yours, that somehow you got hacked and you lost control of those bitcoins. Of course you should make a police report or something like that, and if in the future you're still in the same country and you try to move again those bitcoins and they found out you lied, well, in that case the consequences are not going to be nice I guess. All this is just an hypothetical discussion, many countries don't tax the simple possession of bitcoins.

You mean a wealth tax? We've had that for years, and this year, it's above 2% for the first time. That means, every year again, you'll pay a percentage of your wealth to taxes.
So to break even, your assets need to increase enough in value to make up for inflation and taxes. That was almost impossible in the past years, which is why there are still ongoing lawsuits against these taxes.

Wealth taxes, like most taxes, are only for "the middle class". The poor don't pay them, the rich don't pay them, but anyone in between is not rich enough to move to another country just to avoid taxes.

"What if authorities launch a tax for owning bitcoin?" - They are undoubtedly planning something similar, but how will the authorities know if you are in possession of bitcoin? Unless, of course, you tell this yourself or the platforms in which you will take the KYC tell it.


How can the authorities force you to sell bitcoin? To demand payment of taxes for ownership of btc, you first need to find out from whom to demand these taxes.

What if the authorities declare all wallets stolen or tainted by default and to legalize the wallet, the owner will need to go through KYC and pay taxes so that he can use the wallet officially and in white? But no one forbids using bitcoin directly P2P even from stolen wallets, right.

Therefore, the first thing the authorities will want is for you to independently disclose information about the assets you own. To do this, intimidating laws will be used to force you to do this.

Well, that’s why it was always recommended here to avoid and not undergo the KYC procedure.

But can’t the so-called “wallet thieves” send those funds from a stolen wallet? What prevents you from making a transaction and changing the storage btc address and in case of requests from the tax office, informing that the wallet was stolen the day before and outgoing transactions are transactions of thieves. Let them unravel the further chain of transactions and try to understand who sent those bitcoin to whom and why.

Exchange btc for xmr, and then back again to break your chain of connections. But you will acquire someone else’s chain of connections, someone who also decided to cover his tracks in the same way. :)

If you keep on using P2P services in order to buy or sell the coins, then you will be saved from these additional taxes if the government of your nation imposes it. Due to the decentralised nature of the coin, the government cannot keep a track of these types of transactions. Hence, this is the best way to be saved. Moreover if you uses exchanges regulated by your government, then unfortunately no one can save you from paying the taxes.

And if Bitcoin goes to the moon, you won't be able to use it to buy anything big. That's the risk of not paying taxes, you'll end up with black money.

I don't know which country you are in, or when this law was implemented.

It is true that they can change this situation, but it normally only affects Bitcoins purchased after the date on which this law was first implemented. Because basically, it is impossible for them to know what happened before that date, as there are no official records.

For example in Portugal, this law was implemented in 2023. Therefore, only in this year's tax return do I have to declare the gains obtained from the purchase and sale of 2023. If for example in 2026 they decided to change, the rule will only apply since 2023. Because before that, there are no official records.

But, I don't think it's worth living based on an "IF". We can pay attention to some aspects, and predict what could happen, but continue with our lives normally.

You may laugh after reading my posts. But, Bitcoin is best where it's banned.  ;D ;D
I am not kidding. I live in a 3rd world country and Bitcoin is banned here. So, there is no question of taxing anything related to Bitcoin. However the government does not have any way of knowing if I own Bitcoin or not. I never bought Bitcoin using banks. So, it's connected with any cryptocurrency-related platform. The only possibility to get caught is if they check my devices. But that is unlikely to happen. The authorities won't check person by person to see if anyone holds Bitcoin. If I want to cash out my Bitcoin, send it to someone and get bank transfer through apps and nobody is going to ask why they have transferred the money unless it's a big amount. So, Bangladesh is best for HOLD  8)

Who said you can't do that here either?  ::)
Another interesting point in Portugal is that it was never banned. Therefore, everything can be done normally. This issue of taxes on profits obtained in the last year only exists at the moment - easy to deal with.

Either way, in this case you are right. If it is prohibited in the country, no exchange obtains information to give to the government. You will only have problems if you are caught in the act.

The bolded part is the problem. I know it's the kind of problem you're hoping for, but if Bitcoin goes up enough and you're rich in Bitcoins, it sucks not being able to use it.

Hmm, interesting after reading a couple of the reactions on the post, it is too much haha, TBH in my case and my fellow's case we don't care about Taxation on the Bitcoin as there's no regulatory policy about the existence of the Bitcoin. On the concern of taxation, I think India is a big example as people move to the unreliable and some other alternatives to avoid taxation. If their motive is to track down the movement of the assets they need to carefully decide on the policy to follow.

In short for now, don't worry their primary motive is not to make some bucks by imposing taxation on the asset class Bitcoin.

You need to hold at least a year and trade up to $47,025 in a year to avoid tax.

But if you're someone who earn money (Bitcoin) by freelancing, signature campaign etc, you're supposed to report your income tax regardless how small or big it is. The lowest is 10% (https://smartasset.com/taxes/current-federal-income-tax-brackets), now it depends with your choice, either you commit tax avoidance (pay 10% tax and legal) or tax evasion (0% tax but illegal).

https://imgvb.com/images/2024/01/14/472ba9f1bbae5863cbb5c771e47c7b7e.png
https://www.bankrate.com/investing/long-term-capital-gains-tax/#rates

 :P
I didn't say you cannot do it there. But, you still have to pay taxes on your profit, right?
In this case, banned countries are a bit ahead of it  ;D. Anyway, living in a country where Bitcoin is allowed is like living with full freedom. Paying taxes on gain does not bother unless it's too much like India. I have heard that India applied a 30% tax on Crypto gains or similar things. I don't know the details, but it's ridicules.


Well, there are some other ways to bypass it as well. If I gain enough from Bitcoin that make me rich, I will visit a country where Bitcoin is legal cash it out there, and send it to my country in a legal way. I have a friend who lives in the Middle east and Bitcoin is legal there. They could sell their Bitcoin earnings and send money home via bank transfer or western union.

I don't think the authorities will launch tax for holding Bitcoin. But they can included tax on income. Moreover if any authorities of any country did launch tax for Bitcoin holding then use the Bitcoin power I mean decentralize p2p systems like no one can knows that you are investing on Bitcoin especially when you will hold that Bitcoin.

If I'd receive large amounts of money from the Middle East, I'll get a whole bunch of other questions and it's going to be a lot more difficult to explain the origin of the funds.

In Portugal it is similar, the tax on investment profits (Bitcoin is classified as an investment asset, similar to investing in the stock market), you pay 28% tax.

The person has to know how to manage their portfolio well, in order to do things with the least impact possible, in relation to this issue.

can the government shut down bitcoin if want? it's not possible because bitcoin is not controlled by any government or organization.
if government imposed tax on bitcoin earnings that is fine but it sounds really ridiculous if it's taxed because of holding bitcoin.
dex is the best solution in this situation, you can buy coins and to sell your coins just use p2p feature, government can not trace your wallet.

The government can't control BTC.

BTC was created to preclude centralization.

Well my country is known for luxury jewelry, which I can buy with BTC or other crypto. No bank involved. I don't know if this transaction has to be linked to my identity. If they accept Monero or other privacy tokens for example.

The government may ask how I got my hands on 100k worth of jewelry when I sell it for cash. I can say I found it on the street, or it was given to me by a rich person. I don't think they can force me to pay taxes on jewelry that I own. If I can't sell for cash, I can sell for other crypto.

And right now banks and governments are trying to delist privacy tokens like Monero. While this may work in the short term, I'm pretty sure other tokens will arise. It's interesting to see who will win the battle. But I think the little people have a chance

But what does this mean? Compare it to a gold ETF.
The government wants to control the market. They will do this by taking over the exchanges. One of the things they want at this point, is to force all crypto wallets to apply KYC. They hate the aspect of anonymous wallets. They want to know what you own so they can take it from you or tax the shit out of you.

While the ETF opens the gates to global adoption of BTC, it also means that institutes like Blackrock will do everything in their power to control the market. I expect them to forbid self custody of BTC. You can only buy BTC via their ETF. Meaning they will control all BTC supply. You will not own the BTC by yourself, privately. You will own a contract that says that you own 1 BTC, that they store for you. It is like this with gold. For every bar of gold, there are loads of people who own a contract that says this gold is theirs.

This is how Blackrock rigs all markets and manipulates prices. You are not allowed to own anything. They own it for you and they rig the entire market. If 200 people "own" the same bitcoin, that eliminates the scarcity which makes bitcoin expensive. They can crash the price this way.

Surely they will have to convince the little people that this is best for them. I expect some terrorist attack of which they will say that it was paid with bitcoin

If the government will tax bitcoin hodlers, then where’s decentralization there? I believe as long as bitcoin remains decentralized, no third party will know that you are hodling bitcoin. So it’s useless to say that in order to shut down bitcoin, they will demand bitcoin being taxed, which I think will be highly impossible as no one will surely admit that he’s hodling bitcoin secretly.

Luckily, my country is a crypto friendly. All the crypto transactions are legal but they never see bitcoin or any cryptocurrency as a legal tender, but they don’t put restrictions as well that will discourage the people from making crypto transactions.

People will laugh, but you're essentially spot on here. BTC exists to preclude the very centralization the elite/banks/Blackrock pines for. Stack and hodl.

Such  situation would be unbearable to the individual investors but the reality truth is that Bitcoin is a decentralized digital currency which an existing government authorities has the power to decide if it would accepted or not in both trading and the P2P transactions despites the custodian formula of the Bitcoins technology and of course the individual would be left to dance by the tunes but if you are deep in to make a change out of the situation that you are deprived of Bitcoins legal existence in your place then you have no choice than making a choice to change of location.

If this hypothesis Was possible, then probably the government would have implemented long ago. But obviously it isnt going to work for some obvious reasons.
The whole idea of decentralisation would be defeated if the government can tax BTC holders. I believe that's the essence of been decentralised in the first place.
So, I don't see that happening anytime soon

The way we are seeing everything concerning Bitcoin I think that it is possible that you can transfer your bitcoin to another bitcoin address but that does not mean that is not public there's no bitcoin address that cannot be seen or the private one that is meant for government so any person by saying that there is private one that is meant for government I don't think that that person is totally right

So the essence of having a cryptocurrency especially Bitcoin is because of privacy but many people do not understand the fact, that privacy is why bitcoin is being created and that is why government was against the existence of Bitcoin but I don't think that there is wallet address that government can have access to it because they don't have any access to Bitcoin assuming that government have access to Bitcoin that would have being a challenge of Bitcoin existence.

There's something that many people do not understand the concerning government and the Bitcoin or government and the cryptocurrency the thing is that government is after Bitcoin because they want to take over it without knowing the how the creation take place but that does not mean that any crypto address that you want to transfer your crypto to that government is in charge of all of them or government will know about to them, I think that concept or emphasis is very wrong so let us just know that the government does not have anything to do with it our address especially Bitcoin

I got my first BTC on a centralized exchange. They even have a button saying "my taxes".
When BTC leaves the exchange to my BTC address, there will be a link to my ID. Governments will ask the exchange about my details and they will provide them.

I just need to clean my BTC from here. With other tokens like Monero, for example.
The concept is easy. If they know what you own, they will find a way to take it from you. So we must do everything in our power to prevent them from knowing.

No you don't "need a gameplan against this" because this is just a crackpot theory from some random person you watched on youtube. It's not real. My advice to you is to stop watching crazy people on the internet and believing whatever they say.

Here, that would either mean having to report the found jewelry, or paying tax on the gift. There are no easy "loopholes", everything is regulated.

one loophole:
mix your old coins(cap gain risk) for someones fresh mined coins.. then claim you mined them this year at a hardware/electric cost of $50k a coin (western electric is higher then eastern europe/asia/slavic countries)

thus no gains. plus you can prove acquisition by signing a key that received coin that has miner taint of this years reward
enjoy

Here, that would mean paying income tax ;)

I think you can easily buy BTC on a P2P exchange and keep it in a non-custodial wallet, how can anyone track if you're holding any BTC if you're discreet enough?

self employed. offset costs (electric+hardware)

there are still several mixer platforms operating so you can disguise your tracks from the government through them, that's also what makes me not really like what the government is doing with bitcoin, they just want to get tax money but don't want to be responsible when someone loses bitcoin from their wallet.  The government has never found the best solution to deal with the difficulties faced by society, all they know is how to get more tax money quickly, while Bitcoin is here to be the best solution for the general public and to be a good and trusted investment asset, if more and more people lose their trust in the government then it is not the citizens' fault but it is all purely because the current government cannot be trusted by the citizens.

If you really have a lot of bitcoins and one day you want to cash out without paying any taxes, or in case you never declared anything, in my opinion the best option is to simply leave your country and move somewhere else. It doesn't have to be a permanent move of course, but if you live abroad during the cashout you should be fine. Of course I'm implying that you can demonstrate the origin of those bitcoins and that you never actually evaded taxes, so let's say that you just never declared the possession of those bitcoins. All this is not valid for US citizens since they get taxed also overseas.

I think it's too difficult (but not impossible) to apply tax for owning Bitcoin due to the pseudonymous system of Bitcoin ownership, people can just store their Bitcoin on a wallet that are unknown to government. However Bitcoin transaction can easily be taxed on the Centralized Exchange, and that's is already implemented in my country, every crypto transaction, both crypt-crypto or crypto-fiat is taxed as much as 0.11% of the amount transacted, this is regulated by law. So, all exchange must follow.

I think most countries in Europe anyway have a proactive attitude to bitcoin and in my european
country the government treat Bitcoin as an asset, the same as any other investment.

It means we are free to buy it and HODL it but when we want to sell it for FIAT the "Profit"
is liable for TAX @ 33%, they are quite happy to take their TAX at the "exit" point.

I say one way or another this will work in bitcoin's favor. Cause between outright banning of the cryptocurrency king in your country and getting it taxed/regulated, the latter will always be the better option for current and prospective crypto users.

Imagine how much crypto would be widespread if it has traction in the Republic of China, with its billions of citizens and hundreds of millions of people who was displaced after the ban on mining and cryptocurrency users. Honestly speaking having bitcoin be taxed by the government isn't even a bad thing in the first place, yeah there's the fact that it's going to be grafted and corrupted but in paper the money that you'd give to the government from the transactions and transfers you make in your crypto journey is able to go towards the betterment of your country. Imagine El Salvador being able to not only really use bitcoin as a substitute cryptocurrency but also earn taxation benefits that could help boost its economy from the crypto taxations alone, I think if that would be the case the country's citizens wouldn't be so mad about the abrupt change they brought in back in 2021.

I'm probably just spitballing here but there's a great discussion to be had when talking about cryptocurrency and regulation. Personally I don't think the decentralized aspect of bitcoin wouldn't be so defiled and violated even if it were to be regulated by countries.

In Europe I would say that only the EBC is openly against bitcoin, and it's pretty easy to guess why. The actual countries know that it's pointless to go against bitcoin at this point, especially it would simply mean that some other country will take advantage of the eventual ban. Switzerland for example, a country that knows how to attract foreign money, has always been very open, especially in Zug.

By the way, where do you live? 33% capital gain tax is quite a lot!

That would be a scary thought but how would they know how to target the people that are hodling or as you say owning a bitcoin? Because I can't understand how they'll be able to do that when there's a pseudonymous feature that bitcoin offers and we can all just put all of our bitcoins back to a non-custodial wallet so as to prevent the potential subpoena to get the data from the exchanges which is unlikely especially with international exchanges. The thing that's going to happen though is that people are definitely going to stop talking about bitcoin or crypto openly so as not raise any suspicions that they own bitcoin but I think that the ones that would hide are those that have a really small amount of bitcoin, those that have a lot of bitcoin wouldn't probably mind paying.

this will only be possible to third party platforms registered to operate a business and are governed by the laws and regulations of their respective government. that is, if the user will use their services. otherwise, if they are using their own wallets, the government would not know the true holdings of each user. do you really think users will voluntarily submit to the government and disclose their crypto assets? they may give some numbers but i don't think they will give the actual assets that they have especially that they can be discreet with their crypto holdings.

Maybe it would be a problem for you. But it's common in my country. A lot of people work in the Middle East and the banks here do not bother too much if they see the money comes from the Middle East. Most of the expatriate people live in the Middle East and a large number of foreign money comes from the Middle East. Even the banks pay an extra % to encourage people to send money via banks and to discourage illegal transactions.


This is fucking joke, to be honest. I cannot imagine paying more than 15% tax on my own hard-earned money. This is the reason people do illegal transactions. 28% tax is too much.

I wish I could only pay 28% tax!

The Government is not about to start making up new laws just to tax Bitcoin. I wish they did. That would really piss people off and finally motivate the community to raise the pressure on the next gen development of the Bitcoin market. I imagine that will lead to a more anonymized and decentralized market. I would love to see new BTC adoptees being welcomed by the community and freeing themselves of fiat slavery (Especially talking about freeing their minds of the psychological bonds that come with growing up with a centralized money system).

But Fiat is way more anonymous than Bitcoin (which was never designed to be anonymous). Although BTC can be made anonymous (but we are not allowed to talk about the M word anymore. Because it does not exist ::)).


  

The government can't tax us in any way, because they already focus taxes on our local centralized exchanges. So as long as we hold Bitcoin in private wallets, for whatever reason the government cannot touch it or even impose taxes. That's why it's called decentralization which cannot be controlled by any party. Don't misunderstand crypto taxation, because the regulations that have been established, for example my country's local centralized exchange already has a legal license to operate including taxes. Where did they take it from? You may know that when trading there is a taker and maker system where the percentage is determined, how much goes to the exchange and how much goes to the state treasury. So we no longer need to think about taxes on private property.

Yes that is why mixers existed or you can manually convert your Bitcoins to an Altcoin like monero and then convert it back to Bitcoin. Though needs a lot of work but will possibly work on what you intended to do with your Bitcoins.

Centralized exchanges really has taxes on every transactions we made it is because they are compliant to regulations imposed by central banks.

With non-custodial wallets, that would be hard to traced them and tax those bitcoin owners. No one would even think that they are into bitcoin investment, most especially the government itself. Thanks for having a decentralized system wherein bitcoin becomes a private ownership away from the government control.

However, when bitcoin is kept in a centralized exchange, taxing was made easier since all centralized exchanges are monitored by the government and are subject to follow whatever rule imposed by the government. With that, taxing bitcoin owners will be a lot easy and very possible.

In as much as I hate the government, the system is not a single person, it is always comprised of many people with different opinions and will never agree on the same thing unless a conclusion is reached and a bill is sent to be passed before it can be implemented. As for the tax, I think I know the US ways how digital investments are taxed and it is almost similar to what is being taxed on stocks and other investments. I don't think a reasonable person would want to use tax to kill the investors, if it is to discourage people, they will know and if it is indeed a legal asset people will protest in that country.

However, don't you think that the number of people that have Bitcoin is small for the government to have time for this, they will instead call for a total ban if they don't want something to prosper in their country if they have no intention of legalizing it.


Why do I feel like you are trying to evade tax from your Bitcoin? Not saying you should give the government what they are asking but for your own peace of mind and future problems, if Bitcoin is being taxed in your country and you hold it and you have made profits, kindly give Uncle Sam what he is asking you to avoid any problem later. It is not too hard isn't compared to what might happen later.

As for your wallet, I think it's only when you use a centralized exchange your identity can be known and Bitcoin can be traced, if you have a Bitcoin in your wallet, nobody can ever link that Bitcoin to you except if you bought it on an exchange that recognized you as the buy but don't ignore tax my friend.

This is why government hate up Bitcoin or cryptocurrency as a whole on which they cant really be able to snipped out some juice via taxes into those people who do make up transactions or earning big in this market.
Even now that we've seen that ETF's been that approved but i dont see the relevance of it but rather it is really just that for more regulating transactions and been that monitored on which i cant say that it does really bring out that kind of positivity of the entire market but rather i do see that they are getting having that good hold off towards this market but we know that it wouldnt be all.
There's always that portion on which government or institutions couldnt really be able to handle on.

Example here in our country, yet they arent regulated nor being banned but they are really that suggesting on making use of local crypto platforms on which this is the only
medium on where they could really be able to get those taxes. Yes, its not really that obvious but the fees or deductions are horrendous.

The government cannot even think of this. Remember that bitcoin cannot be controlled by the government, and bitcoin is a currency that operates on its own; nobody controls how the price is or other stuff that happens in the market. Further, anything that will make the government involved in bitcoin will affect the smooth running of the technology because governments will like to change many things that have been making it easier for us to use the technology, and anything that will not favour them will be changed. Remember that the government putting taxation on bitcoin holders will reduce investors from holding or using huge amounts to invest since they will be paying taxes.

However, one of the reasons why I still think this cannot happen is that when the government wants to take a decision, it will not be done by only one person; it will be done by a group of people. Everybody will come up with their own opinion, and we should know that all of their opinions will not go the same way. Some people will go against the motion, and some may support it. Therefore, I don’t think this will happen, and as a bitcoin enthusiast, I don’t want it to happen because it will affect the holders.


 Exactly.There is no way the government will be able to get access to our holdings unless we disclose it to them. Because you are not a holding centralised currency, remember that you are holding a decentralised currency that nobody is supposed to have access to unless with your permission. So I’m still trying to know how the government will think of doing this and succeed because I don’t see any way they will follow after bitcoin is full of privacy. However, did you think people would pay because, with all indications, even those who hoard large amounts of bitcoin won’t allow the governments to know that they are bitcoin holders? The reason is that because of the tax that they will pay, nobody will want to pay even if they have a small amount of bitcoin.

Taxes haven't been an issue for me so far - especially in most cases. That bitcoin tax would obviously be a target for the government - but I'm not really sure they can get it from holders who don't sell it at all. The tax on value added has been implemented in several countries - the government doesn't even need to ask you to pay it manually because exchanges have integrated deductions for tax when you sell bitcoin or altcoin assets.

Owning bitcoin is so far not taxed - but some users have to accept that they are set to pay tax on their investment profits especially when converting them to fiat or other altcoins. After all, bitcoin wasn't created to allow us to completely avoid tax - so we don't need to put extra effort into avoiding it if we don't want to break the rules and get penalized.

^
lets calculate extremes
joins bitcoin 2015 so presumably has year2015 aged coin(~$500 max)
if sold at $40k(december 2023 + min) is 8000% profit... but worries about 28%-40% tax

even taking 28% cut ($28000 equiv) is ~5700% profit
even taking 40% cut ($24000 equiv) is ~4800% profit

bitcoin prices were 24k-28k not even 4 months ago. so the last three-ish months is where bitcoin increased to pay your taxes for you at last septembers profit price.
your still making an average of 5000% profit even after tax

but if you want to avoid-evade taxes entirely. show no gains by swapping your aged/tainted coins with a miner who mined this week. you get clean fresh mined coins(and can show proof of clean non-taint). you then total up hardware cost and electric cost to mine such amount and deduct that as a COST against the coin. and if lucky to have expensive electric you can claim it as a loss/break even. but at a minimum not be classing its as huge gain compared to your original old stash gains

you should seek out a financial adviser to get details straight and answer the "what if" fears that are plaguing your mind.
a fresh prospective will help you worry less and instead see you are still making profit... else there is no profit to tax.

You're missing the point here. I was talking about income tax, and that goes up to 49.5% here. Or higher on certain brackets, because you'll lose other tax benefits that aren't shown directly.

As for our wealth tax: it doesn't matter if you make profit. That's great if you make huge profits, it's bad if you make losses.

I don't think that can be possible. I mean there are so many coins and tokens that people can move their funds from one blockchain to another making it real hard for the authorities to correctly calculate the worth people hodling. So i don't think its even possible, atleast not at this stage.

Link: https://cointelegraph.com/news/crypto-thailand-tax-overseas-income

I think this is how it works, I just came across to this article and seems taxation on Bitcoin or any other cryptocurrency will end up like this if I am not mistaken. Though taxes will only be applicable if you are using local exchange not the transactions carried out from non-costudial hot wallets.

They're use centralized exchanges to buy and sell their coins, whether they declare all of their coins or not, when you sell your coins, they know how many coins you have at that time. If you make a big trade, sooner or later they will put an eye on you.

It just a matter of time when they realize there's a way to cashout without KYC, then they will add a new law to punish people who trying to not pay tax.

How would they be able to track and tax someone who is browsing with concealed IP and has his assets on a non custodial wallet or hardware wallet. Will they have to wait until I move it to an exchange and they will trace it to my identity if I completed KYC. How about if I swap my bitcoin to fiat in a completely decentralized exchange, will they be able to track me. These are just simple ways, how about if technical means are applied.

What OP described cannot happen. The method and level of taxation in place now is enough, only a lil difference would be witnessed and not to the extent of government going dangerously against Hodlers.

If governments get their way, they'd end that too. Once in a while a n00b politician already suggests to ban encryption.

That is possible if the one where your Bitcoin or cryptocurrency assets are stored is on an exchange platform held by the government, but if it is on a decentralized platform, it is unclear and impossible to tax.

That is, as long as there is no authority or decentralization of Bitcoin, no matter what any government in the world does, the government will not be able to issue a tax to all Bitcoin holders. This is impossible to happen unless there is decentralization or blockchain for Bitcoin.

With mining starting to be concentrated in just 3 or 4 large pools, it is not difficult for governments to start creating greater rules and restrictions.

Miners can easily switch pools. The moment one pool is subject to unwanted government involvement (let's say a tax on freshly mined Bitcoins), miners will leave. Money talks.

Because money speaks louder, why do they have to leave if these Pools continue to be the ones that give them the highest income?

Either way, I have great doubts that this will happen. I think the danger of mining being centralized in a few pools is another.

Well tax rules differ by place, so chat with a local expert for advice that fits your situation. Reporting a stolen wallet without a real reason might get you in legal trouble. Sending Bitcoin to an unlinked address could give you more privacy, but be careful about breaking tax laws or other rules where you are. Stay informed, and get pro advice to handle these things smoothly or just keep informed.

Come to my country, nobody even care if you own Bitcoin or not, you won't pay any taxes even on realized gains, it's all yours, the government don't give a heck about how much you made from crypto, it's not even a thing here, that's why when they ban crypto it is just away from the banks, everyone still buy and keep their coins offline using peer to peer method.

I don't like the government, growing up I have hated politicians the most, the sufferness of my people is never for once solved by these people, they only know how to take advantage of the poor, I am not even talking about jobs, the biggest issue is security, now I will work hard and make my money, only to share some part with the government? It will make me extremely angry.

With everything that's happening in the country now, if in future I have to pay taxes on crypto I would rather travel out and start paying taxes in other country, where the government are truly capable.

Exactly! They are very concerned about government getting their way to bitcoin but the fact that even what technology there is bitcoin can't be penetrated, I mean even the government will have a law about putting tax to bitcoin holders what is their means of knowing who owns an wallet address or bitcoin address? Remember the only we have in bitcoin or crypto currency is our wallet address, maybe through KYC they can know but what if we moved our assets to a cold wallet? Or exchanges that doesn't require KYC? There are a lots of way to avoid governments implementing tax, that's the beauty of crypto currency it is complex and secured that we can rest assured that they can't know who we are. So I'm confident that putting a tax for us crypto holders will be impossible at least a lot of years, but even that happens I'm already prepared on how will I secure my assets.

Honestly speaking I don't see this tax coming anytime soon. The government really have to put a lot of work to actually know the amount of Bitcoin that someone is holding, unless they will have to rely on the amount of Bitcoin one trade on cex. I think the government already know difficult it will be for them to actually achieve this that's why they haven't tried it.

In my country the government does tax Bitcoin and other cryptocurrency only when it is being traded on an exchange. The tax is applicable for both profit and loss made during a trade. There is zero tax for holding Bitcoin in a self custody wallet. If in the future the government does tax for holding Bitcoin then how will they know it without the owner of the wallet disclosing about it. What you are saying is not possible unless the government forces it's citizens to disclose about it.

I am not buying this, can you say the same thing about people who have been buying and selling Bitcoin all their lives using centralized exchange? The foot print is already there and nothing can clean it up, only those who have never passed KYC on any CEX and also stick with Peer to peer trading can escape this.

Bitcoin was created as a decentralized currency but the people gave power back to the authorities by using centralized entities to trade their Bitcoin, the fault is on the investors, they invest in Bitcoin but they failed to use it the right way.

You can only be taxed if you trade your Bitcoin on centralized exchanges, it's why the government want every details available on Binance exchange, to know those people buying big without paying taxes, many new mess will happen in the future, many people wont saw it coming.

The same applies to many other taxes: tax payers are responsible for reporting the correct amounts. If you don't, government can fine or imprison you. The level of tax evasion varies per country, Italy (https://www.statista.com/chart/17133/tax-evasion-cost-to-eu-countries/) holds the record in EU. That makes me think it's much more socially accepted in Italy, but I have no idea what consequences there are for tax evaders after they get caught.

They can't shutdown bitcoin even if they want to. They can ban it but there still some people in their country who can surely access it. We are on the tech side of things and finding a way to access or transact on the blockchain would be an easy peasy way. For sure that the government know this, the best thing they can do is to regulate it and capitalize it as much as they can. Taxing it would be complicated if you ask me, especially on the countries where collecting taxes aren't that strict. If somehow new laws where created about taxing bitcoin, surely there will be new loopholes be created  :P


This is a good ideal country beside other countries that is legalizing cryptocurrency. Let's see how majority of the countries react on the ever rising adoption of bitcoin and cryptocurrency.

Despite YouTube theories, a Bitcoin HODL tax is possible in our changing financial world. Authorities want control, and taxes is a classic weapon.

Your strategy of reporting your wallet as stolen for such a tax is dangerous. Im no lawyer, but I've known Bitcoin and know that while it sounds like a smart loophole, it might backfire. Blockchain transactions are visible, so even if you claim the wallet is stolen, any fund movement could implicate you. A fine line between privacy and compliance.

Transferring BTC to an untraceable address is theoretically doable but difficult. Bitcoin's privacy is a myth - theres always a trail. Staying informed and flexible is crucial. Participate in forums, follow legal changes, and diversify your investments. Remember, Bitcoin's strength is its community.

Let me just expound on why this could never happen

Authorities also NEED the internet a lot of their systems would come into a halt if they were to stop the internet from running especially if they are planning on doing it forever most of our society depends now on the internet too much for the government to think that they could possibly remove it from our livelihoods



It has already been established that one of Bitcoin’s main features is its decentralization and in the past years it has proven itself true
Yes, they could link an address to another but they would always encounter a dead-end because they would not know who really owns those addresses

It seems unlikely that tax authorities will introduce a tax on bitcoin ownership. When you acquire bitcoins using a government issued currency through a currency exchange service you are engaging with a regulated financial institution. A proposal to start taxing crypto assets on income derived from investments in digital assets is long overdue. The way the blockchain system is progressing the authorities will not be able to impose anything easily.