The Internal Revenue Service (IRS) is the revenue service of the United States Federal Government. The IRS is responsible for collecting taxes and administering the Internal Revenue Code, which is the main body of the federal tax law of the country. Due to the recent growth of Bitcoin, the IRS has taken notice of the potential of the crypto industry. Also, the advent of Libra which lies ahead and the reverberations that it has spread already has also been picked up by the IRS. The IRS will probably look to fast track regulation on crypto.
The Wall Street Journal’s Report About the IRS’s actions
According to the WSJ, the Internal Revenue Service is looking forward to changing its guidance on cryptocurrencies which was made in 2014 in the coming weeks. This will be done due to a joint effort made by a bipartisan group of 20 lawmakers. This change will be a bigger effort to unlock the full potential of the crypto industry. Also, the WSJ wrote that the US Congress “is considering at least three bills that would resolve some of the murky legal issues surrounding digital money.”
This situation has arisen due to increased focus of US regulators and politicians alike on ‘big tech’ or ‘mega tech’ and all the fields associated with it, the main targets being Google and Facebook especially. The announcement of Facebook launching its own cryptocurrency called Libra has grabbed the attention of many economics aficionados and commerce connoisseurs. Even a Congressional hearing has been held on Libra later this month.
Furthermore, the newspaper said “crypto’s backers in Washington say regulatory clarity is vital to the sector’s growth. They also worry the U.S. is falling behind: Japan and Switzerland have developed legal frameworks that have attracted cryptocurrency projects and investment. Facebook chose to incorporate the group that will govern Libra in Switzerland.”
This has clearly shown the attention that will be given to Crypto from now on. This can lead to two things – increased attention leading to immense market expansion or unjust regulations destroying the market’s scale and reputation.