Bitcoin has been legal in Australia since 2013 so why isn't anyone talking about it?

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Watching the world clash over digital currencies has been something a little odd for me. My country or origin Australia has legalised bitcoin since 2013 and I'm even able to purchase things with it Source. That's of course if the business I'm buying from accepts bitcoin or any cryptocurrency as payment as Bitcoin isn't the only legal cryptocurrency, they all are. Even any crypto that is made today, tomorrow within the next few minutes or over the past few days.

In fact back in 2018 the Cafe close to my work I often visited accepted Bitcoin, Ethereum and XRP. I bought alot of coffee with Bitcoin needless to say everytime I walk into the Cafe now they tend to give me free coffee because those few months of buying coffee with bitcoin was quite the win today as the Cafe kept it and HODL.

It's nice of them to do the free coffee thing, they really don't need to do that. I made a purchase as a customer and the risk of accepting cryptocurrency instead of cash was greater on them then me back in those days. But they're a great family business and it's why I keep going back.

Australia has a progressive tax system

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Now before you take my word as gospel please consult a tax professional as I am not an expert in crypto tax and requirements.

But from information available Australia has been the most progressive for tax purposes towards cryptocurrency and much of the onus is on investors and users of cryptocurrency.

In fact Australia has lessened taxes that saw cryptocurrency double taxed and Australia has removed the GST component of buying and selling cryptocurrency Source this doesn't mean cryptocurrency is recognised as a currency but depending on what you're doing with it, it can be.

For example if I purchase cryptocurrancy and use it to buy items or ingame items then this is not a CGT event and does not attract CGT Tax.

Staking and Decentralised Finance

However, the biggest tax advantage I have as an Australian over many many nations including the US which is still at logger Heads with its current crypto legislation currently being drafted is how airdrops, staking and validation tax and legislation stacks up.

In Australia if I am staking tokens or participating in Decentralised Finance according to the Australian Tax Office (ATO) this is not classed as a capital gains event. The income I earn from staking or even right here on Hive where I blog and receive upvotes is classed as income and goes towards my annual income statement and taxed at the income tax bracket you're in.

I'm predominantly writing this post to make Australians aware as this is something I only learned a few days ago. Unfortunately I listed my Hive as a CGT event and copped a 50% tax rate when I could have significantly lowered that tax bill.

Given online Australian crypto groups seem to run American narratives and get their news from another nation there is alot of frustration over tax rules which are incorrect because we have the most progressive tax rules on the global. So please if you're Australian contact a tax professional to gain clarity and you will learn that we (Australians) have it the best on the planet, which even Binance agrees Source.

Exchanges are legal even Decentralised Exchanges

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In Australia we are able to engage with exchanges and Decentralised exchanges as the requirement for financial obligations are on the exchanges whom must be registered with ASIC and comply with anti money laundering and anti terrorism regulations.

Which is why I use the Australian exchange Coinspot I'm not suggesting you use it as there are other exchanges that comply with these laws so you need to do your own research. The fees are a little higher but not much different to Coinbase and there maybe added security, I can't remember fully but I think there is some protections involved for users but again you will need to do your own research for that part.

Australian National Block Chain Road Map

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In fact Australia is powering a head in the Block Chain space and have developed a National Block Chain Road Map which it hopes will further advance Fintech and achieve mainstream adoption and support current and emerging industries.

I haven't read the paper yet but I intend to over the next few days in spare time and I will be happy to report back on what it says.

But as many know Australia has been an advanced nation when it comes to cryptocurrency and block chain technology but our HUGE island nation has been left out of all block chain related news. Even on Coinmarketcap they do not have us listed as legalised when we were the first.

Furthermore, in the worlds attempt to locate a safe haven for crypto miners as China and Asia cracked down on miners we were over looked despite having the largest potential and most sun and wind to power renewable energy Bitcoin operations.

While the world is in an utter mess fighting about this wonderful emerging Fintech, Australia quietly leads the world. Can someone say hello? we have a range of industry for investors in block chain to work on here without the political and social instability seen.... well everywhere else. We're worth looking into.

Image sources provided, supplemented with CanvaPro subscription. This is not financial advice and is not intended to readers and investors are urged to do their own research or contact an industry professional

Posted Using LeoFinance Beta



24 comments
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Because Australia doesn't fit the narrative of the "loud-mouthed maxi minority" on Twitter and stuff.

They believe poor people with no money and resources are gonna lead the way in financial revolution while completely disregarding the fact that their 100x gains come from formidable institutions and/or whales who may or may not share that vision.

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Hahaha that's true, people more like to fight for the sake of fighting instead of actually doing what needs to be done and getting on with it.

Logical person:Look over there, progressive reform and legal ventures

Twitter: But I have nothing to scream at them about so I will close my eyes and pretend to be blind while yelling at someone else, just because

🤣🤣🤣🤣🤣

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Thanks for the update about the tax situation here in Aus. Will have to look into it.

Do you know off hand if the earnings from the hive network are only reportable if realised or are all on paper gains considered income?

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That is a tricky one and in short, no I don't know. I understand that American's don't need to report it until it is powered down and fully in their possession. I don't think the tax department here has the same view or any view as they wouldn't be aware of individual block chain tokenomics.

I took the safe route and reported it wither way, that being said I don't earn much to make an impact and I have purchased and powered up mine at a much lower rate than current.

I also don't know how it will be taxed if I have already declared and paid tax and then sell it again. I know if HODL for over 12 months it is further reduced but as it is earnings, I'm not clear if selling my earnings that I have already paid tax on also creates a CGT. I would doubt it, but I'll cross that bridge if I ever get there.

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No worries. Thanks for your input. I think ill contact the ato and see what they have to say. At least that way there's something in writing. Like you, my generated on paper income isnt much to be overlay concerned about but would rather have a clear direction on it. Cheers

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There are also Hobby provisions which exempt all income however, this is being a focus point and likely to be removed from cryptocurrency as there have been a significant amount of Bitcoin miners earning significant amounts and not declaring using the loophole of "hobby".

Hobby blogging is a legitimate exemption as are weekend market stalls and other online side hustles. But given people are misusing the loophole and the current economic issues faced by many nations, I'm guessing this will be shrunk further.

But again, I'm not sure and requires further follow up from a professional for clarity.

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Yeah i myself used the hobby provision as a youngster doing night club lighting on a Sat night. It did cross my mind that hive blogging could possibly come under that. It will be interesting to see the ato's response.

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So, bitcoin is considered an asset and not a currency?

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Correct, unless you purchase bitcoin to buy something in bitcoin then it is as a currency not transaction.

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That changed on 7 Sept 2021. BTC is foreign currency for the purposes of Australia's tax laws.
Not sure whether the ATO has recognised this yet but it is legally the case based on well established and crystal clear pre-existing law that the legal tender of any other sovereign state is foreign currency for Australian tax purposes.

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Thats a really good point that needs to be clarified, I don't purchase bitcoin or Ethereum because it seems to be a focus point for regulators. Also mining is considered a CGT event. But I don't know and would be good to investigate or seek clarification on.

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I and others have already raised the issue with the ATO and they are investigating it. I imagine they will publish a revised Tax Ruling on the subject soon.

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Awesome, keep me posted

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This has just prompted me to give the ATO a kick up the arse. They still haven't come out with an official position despite having 3 months notice.

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It's one of the biggest issues with crypto and our current system. We don't know how to treat them tax-wise and there is no real clear way of knowing everything without looking up everything. Maybe at some point we will just have a robot tracking our trades and not have to worry

Posted Using LeoFinance Beta

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Yeah we all should adopt the bitcoins or cryptocurrency

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That would be good, we would potentially see an increase in spending and instant settlements. Lots of advancements in this space.

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The income I earn from staking or even right here on Hive where I blog and receive upvotes is classed as income and goes towards my annual income statement and taxed at the income tax bracket you're in.

Wow...that's mind blowing. I'm reading this from a country where I can't convince people in the crypto world to understand Hive and government adds you Hive pay outs to your taxable income

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Yup, pretty impressive progressive tax reforms that enable Australians to participate in successful projects. The onus at the end of the day is on the person not to lose their cash and follow scams.

Education is key.

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I've been to Australia and one thing I loved about that country was the openness. Not only it is a comfortably diverse country, it supports crypto which is till date banned in my country.


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Oh wow, I don't understand how nations can ban an emerging Fintech

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