Examining Taxation of Fiat Money and Bitcoins Vis-A-Vis Regulated Cryptocurrencies

Kartik Hegadekatti and Yatish S G

MPRA Paper from University Library of Munich, Germany

Abstract: In this paper, we examine the Taxation aspects of Fiat money and Bitcoins vis-a-vis Regulated Cryptocurrencies. We start off by briefly explaining the concept of cryptocurrencies (also referred to as cryptocoins in this paper). We then discuss the concept of Regulated and Sovereign Backed Cryptocurrencies (RSBCs). Then we envisage a scenario where cryptocoins are the main medium of exchange. The taxation aspects of Paper money, Bitcoins and RSBCs are then deliberated with the pros and cons of taxation for each currency format. The currency that can support an Automated Tax Regime is also debated. Finally, the paper concludes by arranging in ascending order, the currencies which are easily amenable to and compliant with taxation policies and laws.

Keywords: Taxation; Bitcoins; K-Y Protocol; NationCoins; RSBC (search for similar items in EconPapers)
JEL-codes: E42 E52 F38 H21 H24 H26 (search for similar items in EconPapers)
Date: 2016-10-02, Revised 2016-10-12
New Economics Papers: this item is included in nep-mac, nep-mon, nep-pay and nep-pub
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Persistent link: https://EconPapers.repec.org/RePEc:pra:mprapa:82073

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