The online crypto community is busy with discussion about a proposed 1% wealth tax on large holders of Bitcoin (BTC)
The fake letter reportedly signed by Senator Elizabeth Warren targets crypto transactions from large holders, often referred to as whales. The legislative proposal seeks to address regulatory challenges posed by the growing adoption of crypto.
Understanding crypto tax in U.S.
As previously disclosed by U.Today, cryptocurrencies are classified as capital assets by the IRS in the U.S. Simply explained, any gains or losses from buying, selling or exchanging cryptocurrencies are treated as capital gains or losses.
In 2021, the Biden administration dropped a tax proposal aiming to increase the capital gains tax rate to 43.4% for citizens whose income exceeds $1 million. The proposal had been met with a lot of criticism. Renowned venture capitalist Tim Draper claimed that it could kill “the golden goose that is America.”
