The more than $430 billion worth of the Inflation Reduction Act (IRA) has been passed by the US Senate, triggering an “exciting” money flow into the cryptocurrency market. However, up to today, the market suddenly had strong fluctuations.
Previously, most of the legislation in the US did not focus much on cryptocurrencies. However, recent laws have had a certain effect on this potential market.
In early August, a $430 billion inflation-reduction act was passed by the US Senate. The act introduced a number of sweeping changes in many areas of the federal government, including the Internal Revenue Service (IRS).
The good news is that, as soon as the act was promulgated, a large amount of money “excited” flowed into the market. On August 5th, the cryptocurrency market had 78 out of 100 gainers. The top coin in terms of market capitalization – Bitcoin increased by 2.19%, reaching 23,798 USD/BTC.
What Does the Inflation Law Mean for Cryptocurrencies and Cryptocurrency Taxes?
The act would introduce a number of sweeping changes to various areas of the federal government, including the Internal Revenue Service (IRS).
Recently, the IRS also provided the treatment and tax rates for cryptocurrencies, but the specific text is still incomplete and contains many shortcomings.
Here is an excerpt from the cryptocurrency and digital asset bill:
“… (ii) IMPLEMENTATION — Expenses necessary for Internal Revenue Service operations to determine and collect taxes owed, legal aid and litigation, conduct criminal investigations (including technology investigation), monitoring the activities of digital assets…”
Not only that, many studies show that the Act may not affect inflation.
According to the Congressional Budget Office (CBO), the Act will have a “negligible impact on inflation” in 2022 and 2023. However, it will affect the Fed’s interest rate hikes and drive the crypto market. fall into the volatility zone.
In addition to the Inflation Reduction Act, President Biden also signed an Executive Order, requiring and directing federal agencies to clearly document cryptocurrencies.
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