Running head: CRYPTOCURRENCIES 1
The Future of Digital Currency Litigation and The Implications for Taxation
Student’s Name
Institutional Affiliation
, CRYPTOCURRENCIES 2
The Future of Digital Currency Litigation and The Implications for Taxation
As digital currencies continue to flood the modern market, regulatory bodies,
especially those that deal with taxation, are in the wake of aligning their litigations with these
technologies. For instance, digital currency litigation received a significant effect last year.
The United States Securities and Exchange Commission (the “SEC”) dispensed its most all-
inclusive direction to date with its Framework for “Investment Contract” Analysis of Digital
Assets (Villanova University, 2020). Also, the United States Department of Justice (“DOJ”)
created criminal charges for money laundering and fraud in association with transactions
involving digital currencies (Villanova University, 2020). New York state regulators actively
regulated cryptocurrency exchanges and issuers through enforcement actions and licensing
determinations (Powell & Hope, 2019). The implications of this development on tax laws are
also far-reaching. The basis for this argument is based on the notion that as an intangible
asset, digital currency is intended to evade regulatory agencies. Based on this notion, the
emergence of cryptocurrencies in the international economy requires tax regulators to be
predominantly agile with digital currency litigation.
Digital currency litigation and the implications for taxation
The future of digital currency is promising, given the rapid advancements that have
been experienced lately. Digital currencies have seen the introduction of Bitcoin, and most
recently, blockchain, which is a technology that allows cryptocurrency to exist digitally
without the ability of a person making copies of the same in a similar way that could be done
with computer files. Given the ability of digital currencies to be used as an intangible asset,
its tax implications are not always clear (Powell & Hope, 2019). It should be noted, however,
that trading in cryptocurrencies is a taxable transaction. As the digital currency continues to
The Future of Digital Currency Litigation and The Implications for Taxation
Student’s Name
Institutional Affiliation
, CRYPTOCURRENCIES 2
The Future of Digital Currency Litigation and The Implications for Taxation
As digital currencies continue to flood the modern market, regulatory bodies,
especially those that deal with taxation, are in the wake of aligning their litigations with these
technologies. For instance, digital currency litigation received a significant effect last year.
The United States Securities and Exchange Commission (the “SEC”) dispensed its most all-
inclusive direction to date with its Framework for “Investment Contract” Analysis of Digital
Assets (Villanova University, 2020). Also, the United States Department of Justice (“DOJ”)
created criminal charges for money laundering and fraud in association with transactions
involving digital currencies (Villanova University, 2020). New York state regulators actively
regulated cryptocurrency exchanges and issuers through enforcement actions and licensing
determinations (Powell & Hope, 2019). The implications of this development on tax laws are
also far-reaching. The basis for this argument is based on the notion that as an intangible
asset, digital currency is intended to evade regulatory agencies. Based on this notion, the
emergence of cryptocurrencies in the international economy requires tax regulators to be
predominantly agile with digital currency litigation.
Digital currency litigation and the implications for taxation
The future of digital currency is promising, given the rapid advancements that have
been experienced lately. Digital currencies have seen the introduction of Bitcoin, and most
recently, blockchain, which is a technology that allows cryptocurrency to exist digitally
without the ability of a person making copies of the same in a similar way that could be done
with computer files. Given the ability of digital currencies to be used as an intangible asset,
its tax implications are not always clear (Powell & Hope, 2019). It should be noted, however,
that trading in cryptocurrencies is a taxable transaction. As the digital currency continues to
