Over the past few years, cryptocurrency has become increasingly seen as one of the most exciting and innovative fields in technology. Crypto-based business are going mainstream in a big way, generating major headlines in the process. Here are three cryptocurrency business news stories you should be aware of.
1. Gemini launches “captive” cryptocurrency insurance company. One of the ongoing problems faced by cryptocurrency exchanges and other related businesses is the lack of insurance companies willing to provide adequate coverage. The cryptocurrency business is still seen as a risky bet — and a prime target for hackers — by most major insurers, requiring crypto companies to get creative when it comes to providing coverage for their customers. This week, New York-based crypto exchange Gemini announced the launch their new in-house insurance company, Nakamoto. The “captive” insurance firm — fully owned and controlled by Gemini — is licensed by the Bermuda Monetary Authority (BMA), and provides a staggering $200 million in coverage. Unfortunately for the rest of the crypto industry, Nakamoto insurance policies are exclusive to Gemini products.
2. Visa to buy cryptocurrency-friendly fintech company Plaid for $5.3 billion. Earlier this week, Visa announced plans to purchase “financial data network” Plaid, a company that allows multiple payment platforms to securely share banking data. While not a cryptocurrency company itself, Plaid is closely tied to a number of high-profile crypto firms — including Coinbase and Abra — opening the door to speculation that Visa is looking to add cryptocurrency payments to its business. The $5.3 billion deal still needs regulatory approval, but is widely expected to be completed by Q3 2020.
3. Bipartisan cryptocurrency tax exemption bill re-introduced to Congress. A new bill that would exempt cryptocurrency from capital gains rules was submitted to the U.S. House of Representatives this week. The “Virtual Currency Tax Fairness Act of 2020” removes reporting and tax requirements for cryptocurrency transactions under $200. Under the current rules, all crypto transactions — no matter how small — are considered taxable events. Worse yet, these transactions are taxed under capital gains rules, meaning that the taxes are determined by the increase in value between initial token purchase and final sale. That’s a serious problem for businesses that want to accept bitcoin and other cryptos, and a dealbreaker for many of their customers. The new bill is an update of an earlier version which set the taxable limit at $600.
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