Tax Policy

Cryptocurrencies have a number of features that do not fit well into existing IRS guidance for tax treatment. This makes things like day-to-day use of cryptocurrency and capital gains tax compliance unnecessarily complicated. Cryptocurrencies are commodity assets (like gold), yet are spendable and tradable easily (like dollars), and can be subdivided down to the tiniest decimal place, which is novel. Further, they can be forked, creating new cryptocurrencies, or sent via a channel containing thousands of tiny payments rather than one large one. These unique qualities raise interesting questions about how existing tax law applies to cryptocurrency.