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Showing posts from August, 2019

Sincerely, Uncle Sam

I don't know about you but I think the best love letters come from Uncle Sam. And by "best," I really mean "worst." Last month, Uncle Sam's favorite agency, the IRS, began to send lovely letters to more than 10,000 taxpayers that transacted cryptocurrency between 2013 and 2017 and either did not report their income from cryptocurrency or did not properly report their crypto transactions. Recipients of the letters are not in tax trouble...yet. Individuals were instructed to verify their crypto-related income and either file delinquent returns or amend their past tax filings, if necessary. If you didn't receive a letter and you deal in crypto, this is still very interesting and relevant. Based on one version of the letter, many have deduced that the IRS may have significant guidance coming down about fair market value calculations for crypto. Specifically, this recent correspondence instructs individuals to look at the date and time of their crypto transac

Back 2 Basics: What is Blockchain?

Sometimes you have to revisit the basics. So, let's do it! What is blockchain? This answer varies based on who you ask (which is never a good sign) but the simplest explanation is that it is a type of distributed database. Instead of data being stored in a central server (with centralized control), the data is stored in nodes which comprise the network. A node can be any electronic device connected to the network (the requirements for nodes vary by network). Generally, the nodes have to agree on the addition of new data, and each node contains the same unique data representing each and every transaction on the network. The data representing individual transactions is packaged into blocks and then blocks are linked via hashes. A hash is a unique identifier that basically represents the two blocks it is linking and it forms the chain. Thus, you have a basic blockchain. So in super simplified terms, you have a network of nodes that all record the same data. Groups of data are packaged