While cryptocurrency assets have been around for a number of years, they seem to have become more prominent in recent years. This is thanks, in part, to the rise of social media (which even resulted in the creation of a meme-based cryptocurrency known as Dogecoin).
The concept is that it is a digital currency that has been encrypted so that the transactions are properly secure. One of the most well-known of these currencies is Bitcoin, but in recent times, it has been suggested that there at least 2500 different types available around the world.
Why Choose Cryptocurrency?
You may see some reports refer to these currencies as “digital tokens” and some businesses prefer this over other forms of investment as they are not currently subject to the same levels of regulation or scrutiny that would be required by a bank or a venture capitalist.
This is further facilitated by the blockchain process, a form of digital ledger that removes the need for a centralized party. Each user notes transactions, making them “locked” so they cannot be changed.
The Potential Challenges
While cryptocurrency assets can be used as payment, they are not currently considered legal tender and are not technically considered to be a form of personal property. However, in the United States, the IRS does consider cryptocurrency as property for the purposes of federal income tax.
It is important to note that times have changed. There have been moves across countries to establish more regulations around cryptocurrency. It is important to seek advice before investing in cryptocurrency assets.
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