What is cryptocurrency
After a decade of explosive growth, cryptocurrency has truly gone mainstream. Aside from the big, established names, new cryptocurrencies are launching almost daily. So let’s look at some of these coins and the process behind launching a new cryptocurrency.< https://quicklocs.com/ /p>
“Rug pull” is the slang given to the practice, such is its frequency. This is where developers promote a new cryptocurrency before “pulling the rug” out from investors and running off with the liquidity.
“Hackers and malicious actors can exploit bugs in the contract code to dupe investors and steal user funds,” Zaknun says. “It is important for investors to verify if a reliable third-party company has independently audited the code.”
Cryptocurrency tax
For the most part, the IRS treats crypto as an asset subject to its rules on capital gains and losses, similar to stocks. When you buy cryptocurrency or stocks, the original purchase price of the asset becomes its cost basis. When you sell that asset, you’re taxed based on the difference between the cost basis and the sale price.
If you received cryptocurrency as a form of wages, your employer will report it at fair market value on your W-2, “Wage and Tax Statement.” You’ll need to report the amount on your income tax return and pay ordinary income taxes on the amount received.
Two common scenarios where you may receive free crypto are airdrops and hard forks. An airdrop is when cryptocurrencies are given away for free and it’s typically used as a marketing tool for new cryptocurrencies.
For the most part, the IRS treats crypto as an asset subject to its rules on capital gains and losses, similar to stocks. When you buy cryptocurrency or stocks, the original purchase price of the asset becomes its cost basis. When you sell that asset, you’re taxed based on the difference between the cost basis and the sale price.
If you received cryptocurrency as a form of wages, your employer will report it at fair market value on your W-2, “Wage and Tax Statement.” You’ll need to report the amount on your income tax return and pay ordinary income taxes on the amount received.
Cryptocurrency bitcoin price
Just two months later, on January 3, 2009, Nakamoto mined the first block on the Bitcoin network, known as the genesis block, thus launching the world’s first cryptocurrency. Bitcoin price was $0 when first introduced, and most Bitcoins were obtained via mining, which only required moderately powerful devices (e.g. PCs) and mining software. The first known Bitcoin commercial transaction occurred on May 22, 2010, when programmer Laszlo Hanyecz traded 10,000 Bitcoins for two pizzas. At Bitcoin price today in mid-September 2021, those pizzas would be worth an astonishing $478 million. This event is now known as “Bitcoin Pizza Day.” In July 2010, Bitcoin first started trading, with the Bitcoin price ranging from $0.0008 to $0.08 at that time.
The cryptocurrency market as a whole is not only based on Bitcoin’s fundamental idea of peer-to-peer transactions without the involvement of a trusted intermediary, but also remains very correlated to the price of BTC as a monetary unit.
This negative sentiment appears to have been broken, with a number of corporate behemoths buying up Bitcoin since 2020. In particular, business intelligence firm MicroStrategy set the pace after it bought $425 million worth of Bitcoin in August and September 2020. Since then, many others have followed suit, including EV manufacturer Tesla.
