Cathie Wood, the founder of Ark Investment Management, has recently shared a piece of advice with people for avoiding Bitcoin transactions. This advice has come regarding the wait for further clarifications on tax regulations before transacting their bitcoin from holdings.
As per the current U.S. Tax Code, the investors are required to pay taxes on their capital gains both while converting their cryptocurrency to fiat and while using their cryptocurrencies to avail services.
According to the recent news regarding the purchase allowance of Tesla with Bitcoin, individuals are advised to be aware of the taxes that they could possibly face while doing the transaction.
The fact that individuals have successfully managed to earn a lot from the recent bull market can not be denied and business minds like Elon Musk are playing extremely well in the given situation.
Speaking during a webcast with CBOE on Thursday, Cathie Wood talked about BTC investors utilizing their capital gains from the transactions. Regardless of the matter that BTC is now conceived as a P2P electronic cash system, it is not the best time to use BTC for transactions.
Addressing the situation, Cathie said:
The IRS in the United States has been considering Bitcoin as property for the past few years that ultimately means that it falls in the exact same section as stocks. Considering Bitcoin as property, rules, and regulations regarding the property acquisition come along with it.
Though it can not be denied that this tax code segmentation doesn’t fit quite well with the concept of cryptocurrencies.