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News From El Salvador, Late August: Preparing for Bitcoin Day’s 1st Anniversary

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It’s hard to believe Bitcoin Day was only a year ago. Let’s go back to El Salvador in anticipation of that faithful day’s celebrations, you’ll find that the country is booming with activity. This compilation of news has it all; from tourism to mining, from conferences to meetups. For a while there, the war with the gangs monopolized El Salvador-related headlines, but with Bitcoin Day’s anniversary on the horizon, it’s time to go back to basics.

High-Level People Prepare For Bitcoin Day’s Celebrations

  • First of all, tourism in El Salvador is back at pre-pandemic levels and then some. President Bukele clarifies that the charts refer to “international tourism,” so the main drivers are “Bitcoin and surf.” Not only that, “internal tourism is growing even more, mainly because of our crackdown on gangs.”
  • Since the original Bitcoin Day, mining in El Salvador has done nothing but grow. In the following video, Anchor mining shows the immersion coolers they brought to El Salvador. Plus, in the tweet, the company’s founder makes a promise.“Soon to launch the educational project where my team will be explaining how immersion cooling is the future of the hashrate decentralization.”
  • This could be huge or nothing at all. Investment platform BankToTheFuture and President Bukele are working on “a number of recovery plans in El Salvador for global distressed Bitcoin lending companies.” Is it possible that the bitcoin lending companies’ future is in the only country with favorable legislation? Or are bitcoin lending companies done for good?

BTCUSD price chart for 08/29/2022 - TradingView

BTC price chart for 08/29/2022 on Bitstamp | Source: BTC/USD on TradingView.com

Meeting Bitcoin-People Is Easy

  • Roman Martinez and Mike Peterson from Bitcoin Beach gave a presentation at the Surfin Bitcoin conference in Biarritz, France. The project that started it all’s legend keeps spreading far and wide. The tweet says, “Probably the most touching conference.The emotion is palpable in Bitcoin Beach. They are proud of their country, proud to be pioneers.”
  • And speaking about Roman and the Bitcoin Beach team, they know how important the upcoming anniversary is. “Join us for the one year anniversary of Bitcoin Day in El Salvador! Our Bitcoin Beach meet-up will turn into a celebration party you can’t miss!”
  • Plus, the Bitcoin Beach team recently received a delegation from the Parlamento Centroamericano AKA Parlacen. “They heard the story of Hope House and how our Bitcoin Beach project used Bitcoin as a tool for financial inclusion and empowerment of the community,” Roman informed.
  • The people from the My First Bitcoin education initiative also run a monthly bitcoin meetup. The only difference is that they do it in San Salvador, the capital. “All of our friends in El Salvador will join us tomorrow for our Bitcoin monthly meetup,” the announcement tweet manifests.

Last But Nor least, Nashin Bupele

  • Since the original Bitcoin Day, El Salvador is everywhere. To prove that, this is a scene from a Korean soap opera in which someone gives a presentation on El Salvador and its bitcoin adoption.

The table is set for Bitcoin Day’s first anniversary. The world was a whole different beast when El Salvador adopted bitcoin as legal tender. That reminds us of Max Keiser’s classic question, is bitcoin a reaction to the chaos or is bitcoin creating the chaos? In El Salvador’s case, the answer is obvious. Bitcoin is taking the country to the next level. 

Featured Image: Nashim Bupele screenshot from this video | Charts by TradingView

DeLorme, El Salvador flagEl Salvador prepares for Bitcoin Day’s first anniversary.





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John Deaton Raises Key Questions on U.S. Crypto Projects and Tax Exemptions

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2 hours ago

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January 26, 2025

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Pro-XRP lawyer John Deaton has raised critical questions regarding tax exemptions for U.S.-based cryptocurrency projects. His remarks focus on identifying which projects qualify for the proposed zero capital gains tax and the implications for companies with global affiliations.

Crypto Lawyer John Deaton Raises Concerns Over U.S. Tax Policies

In a recent tweet, John Deaton discussed the ambiguity surrounding U.S.-based cryptocurrency projects. He questioned whether projects with operations or foundations abroad, such as Solana and Tezos, would meet the requirements for tax exemptions.

Solana Labs, headquartered in San Francisco, operates under the Solana Foundation based in Switzerland, while Tezos was developed by U.S.-based Arthur and Kathleen Breitman but is governed by the Switzerland-based Tezos Foundation. Deaton’s inquiry centers on whether such hybrid structures qualify as U.S.-based entities under the proposed tax policies.

John Deaton also pointed to cryptocurrencies like XRP, XLM, HBAR, AVAX, and XCH, which may face fewer jurisdictional hurdles. These projects meet the criteria on the surface, potentially positioning them to benefit from the zero capital gains tax.

Moreover, Deaton emphasized the potential for tax incentives to drive broader adoption of cryptocurrencies as corporate treasury assets. He questioned whether companies adopting digital assets like XRP, XLM, and HBAR would gain a competitive edge under the proposed zero capital gains tax policy.

He also raised concerns about the treatment of foreign entities with U.S. operations, such as Hut 8, and their eligibility for tax benefits.

More so, recently the pro-XRP lawyer highlighted four key objectives for the White House Crypto Council. He urged its members to focus on critical areas like SAB 121, the establishment of a strategic Bitcoin reserve, crypto tax payments, and overarching crypto taxation policies. 

U.S. Crypto Companies and Mining Firms Could Reap Benefits

John Deaton further explored how U.S.-based companies, including Ripple, Gemini, and ConsenSys, might benefit from the tax exemption if it applies to corporations. The tax breaks could incentivize these firms to expand their crypto holdings and encourage other companies to adopt cryptocurrency as a reserve asset.

Deaton also addressed the status of Bitcoin miners like Riot Platforms and Marathon Digital Holdings. These U.S.-based miners might qualify for the exemption, but questions remain about companies like Hut 8 Corp, a Canadian entity with expanding operations in the U.S. John Deaton highlighted the need for clarity on whether international companies with significant U.S. activities could also benefit.

Treasury Reserve Strategies and Corporate Crypto Adoption

Another key issue raised by Deaton involves corporations adopting cryptocurrencies like Bitcoin, XRP, and HBAR as part of their treasury reserves. He questioned whether such strategies would qualify these companies for tax benefits under the new policies.

Prominent firms like MicroStrategy, known for its Bitcoin holdings, could stand to gain from the tax exemption if their crypto reserve strategies align with the proposed framework. The policy might also encourage other companies to include crypto in their balance sheets.

More so, recently, Deaton also emphasized the broader challenges facing the cryptocurrency industry. He criticized past regulatory actions by the U.S. Securities and Exchange Commission (SEC), which he described as resource-draining and counterproductive.

John Deaton called for an end to what he referred to as “crypto wars,” urging a shift toward clearer regulations to support innovation.

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Ronny Mugendi

Ronny Mugendi is a seasoned crypto journalist with four years of professional experience, having contributed significantly to various media outlets on cryptocurrency trends and technologies. With over 4000 published articles across various media outlets, he aims to inform, educate and introduce more people to the Blockchain and DeFi world. Outside of his journalism career, Ronny enjoys the thrill of bike riding, exploring new trails and landscapes.

Disclaimer: The presented content may include the personal opinion of the author and is subject to market condition. Do your market research before investing in cryptocurrencies. The author or the publication does not hold any responsibility for your personal financial loss.





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Will SAB 121 Abolition Allow Banks To Hold Bitcoin

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13 hours ago

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January 25, 2025

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Donald Trump’s crypto policies have ignited a sense of optimism within the industry, hinting at a new era of growth and innovation. The US Securities and Exchange Commission’s decision to rescind SAB 121 has further fueled confidence. Experts hope that the abolition of SAB 121 will pave the way for the establishment of Bitcoin banks.

Notably, Stacy Herbert, Director of El Salvador’s Bitcoin Office, has expressed hopefulness about banks holding Bitcoin. Her statement reflects a general excitement surrounding the integration of Bitcoin and other cryptocurrencies into the US banking industry.

SAB 121 Rescission Greenlights Bitcoin Banking

In a recent X post, Stacy Herbert, the Director of Bitcoin Office, El Salvador, commented on the potential acceptance of Bitcoin in financial institutions. While her optimism is mainly driven by the SEC’s recent abolition of SAB 121, Herbert stated, “Bitcoin banks are coming.”

Herbert’s post came in response to MicroStrategy founder Michael Saylor’s X thread on the withdrawal of SAB 121. She emphasized the benefits of Bitcoin banks, suggesting that integrating Bitcoin into traditional banking could potentially boost investments.

SEC Withdraws SAB 121, Releases SAB 122

In a phenomenal development, the US SEC withdrew Staff Accounting Bulletin No. 121  and released Staff Accounting Bulletin No. 122. While SAB 121 restricted banks’ custody of cryptocurrencies, SAB 122 reverses the rule that forced entities to log a liability when protecting client crypto assets.

SEC Commissioner Hester Peirce, who now lead the newly formed Crypto Task Force, responded to the SAB 121 abolition with an X post that read, Bye, bye SAB 121! It’s not been fun.”

Similarly, Senator Cynthia Lummis expressed her contentment with the SEC’s action, stating,

SAB 121 was disastrous for the banking industry, and only stunted American innovation and advancement of digital assets. I am THRILLED to see it repealed and get the SEC back on track to fulfilling its intended mission.

Trump Government Fights Operation Chokepoint 2.0

Joe Biden’s administration has been accused of stifling the crypto industry by pressuring banks to sever ties with crypto businesses, a move critics have dubbed “Operation Chokepoint 2.0. Coinbase CEO previously said that the Biden government was trying to “kill” the entire crypto ecosystem. The SEC’s SAB 121 was also such a move that stifled the crypto economy.

However, the US lawmakers have recently launched investigations into the matter, examining the government’s regulatory overreach. While many including Brian Armstrong, Hayden Adams, and Paul Grewal have openly raised voices against Operation Chokepoint 2.0, the US Oversight Committee pledged to address the issue.

Regulatory Shifts Mark the Future of Bitcoin Banks

Trump’s executive order that focuses on crypto has ushered in a new era of crypto markets in the US. Recently, the President signed an executive order to develop a national digital asset stockpile, sparking community enthusiasm. These policy shifts, especially the abolition of the controversial SAB 121, signal the emergence of Bitcoin banks.

In anticipation of the US banking industry’s adoption of crypto, Draper University Founder Tim Draper stated,

Goodbye to SAD SAB 121. We welcome banks to the new world of Bitcoin. Banks don’t have to pretend that the dollar is better anymore.

Moreover, Bank of America CEO Brian Moynihan’s assurance that the US banking industry would embrace cryptocurrencies upon regulatory approval has bolstered hopes for mainstream adoption. Circle CEO Jeremy Allaire also remains bullish on the financial institutions’ endorsement of digital assets.

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Nynu V Jamal is a passionate crypto journalist with three years of experience in blockchain, web3, and fintech spheres. She has established herself as a knowledgeable and engaging voice in the cryptocurrency and blockchain space. Her experience as an Assistant Professor in English Language and Literature has further added to her quest for crafting informative, well-researched, and accessible content.

Disclaimer: The presented content may include the personal opinion of the author and is subject to market condition. Do your market research before investing in cryptocurrencies. The author or the publication does not hold any responsibility for your personal financial loss.





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MicroStrategy May Face Tax Issues Over $19 Billion Unrealized Bitcoin Gains: Report

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21 hours ago

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January 25, 2025

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According to a report by The Wall Street Journal, business intelligence firm MicroStrategy may face significant tax liabilities on its unrealized Bitcoin (BTC) gains, valued at $19 billion. MicroStrategy, notably the world’s largest corporate BTC holder, currently holds more than 430,000 BTC on its balance sheet.

Unrealized Bitcoin Gains Could Pose Challenges For MicroStrategy

As of now, MicroStrategy’s total Bitcoin holdings are worth over $47 billion, with $19 billion in unrealized gains. Over the years, the US-based company has raised funds through stock and debt offerings to finance its BTC purchases.

While MicroStrategy has not sold any Bitcoin to date, it may still be required to pay billions in taxes on its holdings due to the Corporate Alternative Minimum Tax (CAMT) provision under the Inflation Reduction Act passed in 2022. Specifically, the CAMT imposes a 15% tax rate based on an adjusted version of a corporation’s earnings.

bitcoin
MicroStrategy is the largest corporate holder of BTC | Source: CoinGecko

It is important to note that the Internal Revenue Service (IRS) provides exemptions for unrealized gains from securities, such as common stock. However, the IRS has yet to extend such exemptions to unrealized gains on cryptocurrency assets like Bitcoin.

Tax analyst Robert Willens commented that the IRS may draft rules that favor MicroStrategy, particularly given Donald Trump’s pro-crypto stance. However, he cautioned that this outcome is not guaranteed. Willens explained:

If the Biden group was still in place, they probably wouldn’t get the exemption. It would be easy to slot crypto assets into the same exemption that stocks are going to enjoy, because there’s no real difference in the accounting.

Should MicroStrategy be required to pay taxes on its unrealized Bitcoin gains, the company might be forced to sell off a portion of its holdings to raise cash. Such a move could unsettle the volatile crypto market, potentially triggering a broader market-wide downturn.

Notably, both MicroStrategy and Coinbase have petitioned the US Treasury and IRS to exclude unrealized crypto gains from the adjusted financial income calculation under the CAMT. In their request, the firms argued that such measures are necessary to “avoid serious unintended consequences for U.S. corporations holding substantial cryptocurrency.”

IRS Keeping A Close Eye On Crypto

As the tax season approaches, the IRS is ramping up its efforts to ensure greater transparency in cryptocurrency transactions. Recently, the agency introduced a new reporting system for centralized exchanges to track crypto transactions more effectively.

The IRS has also reaffirmed its stance on crypto staking, stating that any rewards generated from staking are taxable upon receipt. According to the agency, staking rewards are not classified as new property, and thus, should be taxed immediately upon acquisition.

That said, optimism among financial advisors has risen following Trump’s victory in the US presidential election, with the majority of them showing greater willingness to explore investments in digital assets. At press time, Bitcoin trades at $105,523, up 2.6% in the past 24 hours.

bitcoin
BTC trades at $105,523 on the daily chart | Source: BTCUSDT on TradingView.com

Featured Image from Unsplash.com, Chart from TradingView.com



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