US Launches Cryptocurrency Isolation Operation...Countries Worldwide Wage 'War on Coins'

China bans P2P trading and mining
US mandates reporting for transactions over $10,000
National Tax Service doubles workforce in 10 years
Powell "Leading development of own digital currency"

[Image source=Reuters Yonhap News]

[Asia Economy New York=Correspondent Baek Jong-min] The U.S. Treasury Department has mandated that cryptocurrency transactions exceeding $10,000 must be reported to the Internal Revenue Service (IRS). This move targets attempts to evade taxes using cryptocurrencies. Following China’s ban on cryptocurrency mining and peer-to-peer transactions, the U.S. has also tightened regulations, leading the market to view this as the beginning of a full-scale "war on cryptocurrencies." Some analysts suggest that the pressure from both the U.S. and China aims to ultimately "isolate and suffocate cryptocurrencies" by restricting or reducing transactions.

On the 20th (local time), the U.S. Treasury Department announced guidelines requiring all cryptocurrency transactions over $10,000 to be reported to the IRS. The Treasury specifically pointed out that "cryptocurrencies are widely facilitating illegal activities, including tax evasion, causing significant problems."

The Treasury explained that businesses receiving cryptocurrencies with a fair market value of $10,000 or more must report these transactions to the IRS, similar to cash transactions. This announcement was made as part of the Biden administration’s plan to secure tax revenue to support infrastructure investments. The Treasury also revealed plans to double the IRS workforce over the next decade.

The Treasury’s announcement is interpreted as the starting point of U.S. regulatory measures on cryptocurrencies. Ed Millis, an analyst at global financial group Raymond James, said, "Regulatory risks surrounding cryptocurrencies are showing signs of reemerging in public discourse," adding, "This will pose a threat to the cryptocurrency market in the short term."

Earlier, Treasury Secretary Janet Yellen stated during her Senate confirmation hearing, "I believe many cryptocurrencies are primarily used for illicit finance. We need to consider ways to reduce such usage and prevent money laundering." Since 2020, the IRS has been taxing capital gains from cryptocurrency trading by U.S. individuals.

On the same day, Jerome Powell, Chair of the U.S. Federal Reserve (Fed), delivered an unusual video message announcing, "The Fed is working on developing its own digital currency and will publish a research paper by summer," adding, "We will lead the development of digital currency." While Powell did not provide specific plans for the development and implementation of a digital dollar, he mentioned technological advancements and explained that the Fed is carefully monitoring and adapting to innovation. Internally, the Fed is conducting digital currency research jointly with the Federal Reserve Bank of Boston and the Massachusetts Institute of Technology (MIT).

This content was produced with the assistance of AI translation services.