The Australian government has announced a major decision to let cryptocurrency continue to be taxed as Capital Gains Tax, meaning it will be excluded from foreign currency tax arrangements.
Treasurer Jim Chalmers and Assistant Treasurer Stephen Jones said the government’s decision will provide certainty and clarity at a time of increased volatility in the crypto space.
The decision follows the move by Central American nation, El Salvador, to allow Bitcoin as legal tender.
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The changes will be backdated to July 1st 2021.
The decision signifies a pragmatic approach by the Australian government to the rapidly evolving crypto space.
It’s been a rough year so far for digital assets, with the entire crypto space losing around two trillion dollars since last November.
Flagship token Bitcoin has sunk to a little over US$20,000 after reaching an all time high of US$67,500 in November.
While wider economic factors, such as rising inflation and interest rates, as well as the ongoing conflict between Russia and Ukraine, have impacted the crypto market, the fall of digital assets has also been impacted by the suspension of withdrawals by two cryptocurrency platforms.
Extreme market conditions forced crypto lender Celsius to pause all withdrawals with crypto exchange Binance also suspending Bitcoin withdrawals.
Moving on to market news, and Bitcoin fell around one percent in the past 24 hours to stay above the 20K mark and was recently trading at US$20,400.
Meanwhile, Ethereum dropped four percent overnight and was recently trading at US$1,076.
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Data Source: CoinMarketCap.com, based on top 100 cryptos.
Note: Growth from the 24 hours prior to 12:30pm AEDT
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