From Tyler Durden: After soaring to new record highs near $6000 last week (as China returned to work following its Golden Week holiday), the start of the National Congress last night, combined with CFTC comments on ICO crackdowns has spooked cryptocurrencies with Bitcoin down 8% — its biggest drop in a month.
Crytpos are down across the board…
With Bitcon back to a $5100 handle…
Some have suggested the weakness is due to US CFTC comments, as Bloomberg reports, in a primer on the asset class published Tuesday, the agency said virtual “tokens” used in initial coin offerings can come under CFTC oversight, a message that a market averse to scrutiny did not take well. But this seems old news since the U.S. Securities and Exchange Commission has already said tokens from some ICOs can be securities under its oversight. “There is no inconsistency between the SEC’s analysis and the CFTC’s determination” from 2015 that virtual currencies are commodities, the CFTC said.
Another possibloe catalyst is news, via Coinivore, that South Korea is preparing to tax Bitcoin use…
The South Korean government is preparing to tax Bitcoin use after the cryptocurrency’s trading volume largely increased past the country’s stock exchange Kosdaq. Han Seung-hee, the commissioner of the country’s National Tax Service, told lawmakers this weekend that the issue of how to best tax cryptocurrencies is being discussed, including the areas of capital gains tax, the VAT, and gift tax, Bitcoin.com reported.
South Korea’s lawmakers held a National Tax Service (NTS) hearing in Sejong last week on October 13th. The NTS Commissioner Han Seung-hee answered several questions about the taxation of cryptocurrencies.
Seung-hee was asked, “as the daily transaction value of virtual money grows beyond the Kosdaq, we must actively cope with the shift away from the conventional reservations. What is the taxation plan?” Business Post reported.
“I am still taxing business income, and I am discussing whether to tax the value-added tax or capital gains tax with regard to virtual currencies such as Bitcoin,”Seung-hee said.
According to Seung-hee, his department is currently discussing the VAT and capital gains tax issues with the Ministry of Strategy and Finance. Additionally, he stated that “the gift tax will be reviewed as it needs to be supplemented,” the publication wrote. The Commissioner further pointed out that the use of Bitcoin may lead to “gift tax evasion,” therefore valuations methods need to be implemented with respect to the taxation of cryptocurrency gifts.
In the meantime, he confirmed that “we are currently monitoring the status of the cryptocurrency transactions and will move forward quickly.”
The letter, signed by around 50 supporters from the Brazilian and Argentinian Bitcoin space, went live on Medium Wednesday.
The collective “opposition” to the forthcoming Bitcoin hard fork is the the latest to come from the industry, which has already seen exchanges and others signal public condemnation.
Last week, South Korea’s largest Bitcoin meetup released a similar open statement denouncing SegWit2x.
“We do believe the NYA signatories have the best of intentions in attempting to improve Bitcoin’s protocol, and we also recognize the invaluable service historically provided by the companies and the talented individuals associated with S2X,” the Brazilian-Argentinian letter reads.
“We profoundly disagree, however, with the means chosen to carry out such a plan. And therein lie all the discord, controversy, feverish debates, and even resentment for some actors.”
The group provided what it calls a “non-exhaustive” list of eleven factors influencing its decision, many of which match with reasons given by both South Korea and exchanges confirming they will not support any Bitcoin chain split.
Bitcoin has since bounced off the lows today, rising back to the 5,690.48 level in Thursday morning trading.
This article is brought to you courtesy of ZeroHedge.