Due to the general interest in the cryptocurrency market, there is also an increasing need to define laws that regulate all issues related to the purchase and sale of it. Tax organizations and banks around the world are working to resolve all issues related to digital currencies. Meanwhile, now more than ever you can safely earn a lot of money by investing in cryptocurrencies, but at the same time there are also certain legal risks when buying and selling it. Today we are going to tell you what you need to know and what to be ready for when you decide to buy a digital currency. One of the legal issues that may arise when investing in cryptocurrency is the safety of your investment, especially if you are using a crypto payment app to pay for goods or services.

• Fraud and falsification

Despite the fact that now investing in cryptocurrency is an extremely popular and profitable way to earn money, it is at the same time an excellent place for fraudsters to commit many financial crimes. Unfortunately, investors who have been victims of financial crimes most likely don’t have the same legal opportunities as traditional victims of money fraud. For example, when a crypto exchange is hacked and users’ funds are stolen, there is no standard guide on recovering missing funds. Trusted digital currency investors take on a certain risk by buying assets. For those investors who still prefer to avoid risks, we advise them to turn to other possible investment options for the time being. One of the most reliable ways to invest is to buy gold coins and bullion. Gold remains one of the most popular investments in any economic situation, especially during periods of crisis. This is an ideal protective asset that saves investors’ money from the collapse in the markets. In addition, it is much harder for fraudsters to rob a bank where gold is stored. Another advantage in buying gold is a large number of suppliers, who often provide gold coins for sale. It is also easier to sell investment coins than a bullion, since there is a large secondary market for collectors.

• Cryptocurrencies and Taxes

One of the most tough legal issues related to cryptocurrency is the tax system, which varies in each country. In reality, the situation is constantly changing, which is why investors need to monitor the latest statements from the tax authorities of their state. In the USA, cryptocurrencies are defined as property, not as a monetary currency. Thus, in the USA it is obligatory to provide annual reports on your profits and expenses in cryptocurrencies, even if you have purchased them in another country. On the contrary, if you pay salaries to your employees with digital money, then cryptocurrency is taxed as income. The tax is based on the value of the cryptocurrency at the time of payment. That is why it is necessary to regularly monitor the news and changes in laws concerning digital currency.

• Bank account regulations

The US Treasury Department announced the need to regulate the cryptocurrency market to combat criminal activity. It is expected that this rule will require exchanges to submit reports on the history of all transactions worth more than 10,000$ and also all owners will be required to identify themselves when sending more than 3,000$ per transaction. Nowadays, the US continues to progress in developing federal cryptocurrency legislation.

However, while new types of digital wallets are emerging and exchanges are constantly working to improve security measures, there are still legal risks associated with owning cryptocurrencies. The main thing is always to be aware of the laws concerning the digital currency market only then you and your money will be safe.