World’s Biggest Banks Helped Clients Steal $63 Billion in Taxes in Europe

World's Biggest Banks Help Clients Steal $63 Billion in Taxes in Europe

Europe’s top banks allegedly helped wealthy clients across the continent steal 55 billion euros ($63 billion) from multiple governments by making tax reclaims to which they were not entitled, an investigation has revealed. The theft centred around a complex scheme of trading stocks that also involved hedge funds and large international commercial law firms.

Also read: $50 Million Bitcoin Mining Farm Opens in Armenia

Undercover Journalists Uncover ‘the Biggest Tax Swindle in the History of Europe.’

The undercover probe by 37 journalists from 12 countries shows that about a dozen European countries are affected by the tax scandal, but Belgium, Denmark and Germany were hardest hit. France, Italy, the Netherlands, Norway, Spain, Sweden and Switzerland have also seen some damage.

World’s Biggest Banks Help Clients Steal $63 Billion in Taxes in Europe

Dubbed the Cumex Files, the investigation reviewed 180,000 secret documents from banks, stock traders and law firms over a period of more than a year. Interviews with anonymous sources and whistleblowers provided extra detail. “They [the secret documents] demonstrated the extent to which banks and investors could reimburse taxes on stock deals that they did not have,” the Files said.

“These windy financial constructs are called cum-cum (cum means ‘dividend’). A domestic bank helps a foreign investor to get a tax refund that they are not entitled to. The profit is shared between the participants.”

A variant of the scheme, called ‘cum-ex’ (without dividend), would see traders refunded twice or, in severe cases, several times, by the state for taxes buyers or sellers of stock would have paid only once. Share ownership is often difficult to point out because of the complex structure of the schemes, which constitute a form of tax evasion or avoidance.

Both cum-cum and cum-ex went on for decades unnoticed due to different regulations within European Union member countries.

World’s Biggest Banks Help Clients Steal $63 Billion in Taxes in Europe

Mixed forms have emerged, the report says, “and new, even more aggressive mutations for which there are no names yet.” The investigative journalists claim that they have uncovered “the biggest tax swindle in the history of Europe.”

“It was a trade that was initially discovered by chance,” a separate video of the Cumex Files detailed. “Yet a group of masterminds turned it into an industrialized cottage industry, from Dubai to London, New York to Dublin taking billions of euros out of the pockets of European tax payers,” it said.

Banks in Up to Their Necks

The investigations revealed how some of the world’s biggest banks have been instrumental in aiding the tax fraud. UBS, BNP Paribas, Barclays, JPMorgan, Meryll Lynch, Banco Santander, Morgan Stanley, Deutsche Bank and Swedish bank SEB have all been implicated.

They allegedly helped tax evaders drill a hole of around $2 billion in Danish state coffers. A tip-off from Danish authorities helped Sweden prevent more than 10 fraud attempts totaling 380 million kroner ($46 million), according to Swedish news agency Di. But that was not before local bank SEB allegedly received 70 million Swedish kroner ($7.8 million) for helping to conceal one billion Swedish kroner ($111 million) from the German treasury.

World’s Biggest Banks Help Clients Steal $63 Billion in Taxes in Europe

In Germany, where authorities halted cum-ex trading in 2012, the potential tax losses from cum-cum deals between 2001 and 2016 is anything upwards of 49.2 billion euros ($56.6 billion), according to a 2017 report.

Perpetrators told the investigating team that “it is legal to be reimbursed for taxes that were never paid.” However, governments “assume a tax abuse of design, if business is purely tax-motivated,” the Cumex Files explained.

“The deals are solely for the purpose of collecting taxpayers’ money. Otherwise, there is no value behind the trade,” said the investigators, adding that the schemes started to pick up around 2007 during the global financial crisis, “a time when the state will save the banks from collapse, again with taxpayers’ money.”

European lawmakers have called for an official investigation into the cases. “Tax theft is a crime against society. Europe cannot and must not tolerate this!” MPs in the European parliament said in an online statement.

What do you think about the Cumex Files findings? Let us know in the comments section below.


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Danske Bank’s Alleged Money Laundering Now Totals $234 Billion, CEO Quits

Danske Bank's Alleged Money Laundering Now Totals $235 Billion, CEO Quits

The investigation into Danske Bank’s alleged money laundering has uncovered new funds. The amount of “questionable money” flowing through the bank’s Estonian branch has grown from $150 billion to approximately $234 billion. In response, the CEO of Danske Bank turned in his resignation.

Also read: 160 Crypto Exchanges Seek to Enter Japanese Market, Regulator Reveals

From $150B to $234B

Danske Bank's Alleged Money Laundering Now Totals $235 Billion, CEO QuitsDenmark’s largest bank released the report detailing the results of its internal investigation into the money laundering allegations involving its Estonian branch on Wednesday.

Prior to this release, $150 billion allegedly flowed through Danske Bank’s Estonian branch to suspicious accounts of non-resident clients from 2007 to 2015. However, the bank’s investigation has revised this number. Danske has “acknowledged that about €200bn [~US$234 billion] in questionable money flowed through its small Estonian branch in one of the largest money laundering scandals ever uncovered,” the Financial Times reported.

Lars Lokke Rasmussen, Denmark’s prime minister, was quoted by the news outlet:

I’m shocked. The numbers that came out today are of an astronomical magnitude. It is, of course, deeply disappointing that a bank that I consider to be an important player for Denmark has become involved in this kind of activity.

Danske’s Investigations

Danske Bank's Alleged Money Laundering Now Totals $235 Billion, CEO Quits“The investigations have been led by the Bruun & Hjejle law firm,” Danske Bank described, adding that “The scope of the investigations covers approximately 15,000 customers and 9.5 million payments.”

According to the report, “Some 12,000 documents and more than 8 million emails have been searched, and more than 70 interviews have been conducted with current and former employees and managers…Overall, approximately 70 people have worked full time on the investigations.” In addition, the report states that approximately 6,200 high-risk customers have been examined, “and the vast majority of these customers have been deemed suspicious.”

The Financial Times added that “The non-resident customers came from countries including Russia, the UK and the British Virgin Islands, but the bank said it could not yet estimate how much of the total was illicit.” The news outlet noted that Russia’s central bank said that Danske customers “permanently participate in financial transactions of doubtful origin,” estimated at billions of roubles monthly.

CEO Borgen Resigns

On Wednesday, Danske Bank also announced that its CEO, Thomas F. Borgen, has resigned. He has been the bank’s CEO since 2013 and was in charge of international banking including Estonia from 2009 to 2012. Borgen said:

It is clear that Danske Bank has failed to live up to its responsibility in the case of possible money laundering in Estonia. I deeply regret this…I believe that it is best for all parties that I resign.

According to the bank’s announcement, Borgen will continue in his position until a new CEO has been appointed.

Donation and Revised Outlook

Danske Bank's Alleged Money Laundering Now Totals $235 Billion, CEO QuitsAnother announcement made by Danske Bank on Wednesday concerns the donation of DKK 1.5 billion (~$235 million).

“Danske Bank does not wish to benefit financially from suspicious transactions that took place in the non-resident portfolio of its Estonian branch in the period from 2007 to 2015,” the bank wrote, adding:

As the bank is not able to provide an accurate estimate of the amount of suspicious transactions made by non-resident customers in Estonia during the period, the Board of Directors has decided to donate the gross income from the customers in the period from 2007 to 2015, which is estimated at DKK 1.5 billion, to an independent foundation.

The foundation will be “set up to support initiatives aimed at combating international financial crime, including money laundering, also in Denmark and Estonia.”

The bank further explained that its net profit for 2018 has been revised downward due to this donation. “We now expect net profit for 2018 to be in the range of DKK 16-17 billion [~$2.5-2.7 billion],” the bank clarified, noting that previously it “expected net profit for 2018 to be at the lower end of the DKK 18-20 billion [~$2.8-3.1 billion] range.”

Why do you think regulators are going after crypto when there is so much money laundering in the banking system? Let us know in the comments section below.


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Denmark’s Largest Bank Took Two Years to Close Accounts of Blacklisted Russian Clients

Denmark’s Largest Bank Took Two Years to Close Accounts of Blacklisted Russian Clients

Denmark’s largest bank, Danske Bank, reportedly knew that some of its Estonian branch’s clients were on the Russian government’s blacklist but did not close their accounts for two years. The bank is currently being probed by three countries over $150 billion money laundering allegations.

Also read: 160 Crypto Exchanges Seek to Enter Japanese Market, Regulator Reveals

Danske ‘Ok’ With Blacklisted Clients

Denmark’s Largest Bank Took Two Years to Close Accounts of Blacklisted Russian ClientsDanske Bank is currently under investigation by authorities in three countries: the US, Denmark, and Estonia. Its officials reportedly “knew earlier than previously indicated about problems at its tiny Estonia branch, including that it held accounts for blacklisted Russian clients,” The Wall Street Journal reported Tuesday, citing correspondence it has seen. The publication elaborated:

Officials at Danske Bank were aware almost two years before it started shutting questionable accounts that the small but highly profitable branch was involved in potentially illicit money flows.

Denmark’s Largest Bank Took Two Years to Close Accounts of Blacklisted Russian ClientsThe Estonian branch was one of the bank’s profit drivers, generating a net profit of €63 million (~US$73.5 million) in 2012, the most lucrative year. The whole bank reported €636.6 million (~$742.6 million) in net profit that year, the publication noted.

The largest bank in Denmark has been at the center of one of Europe’s largest money laundering cases. Between 2007 and 2015, an estimated $150 billion was suspected to have flowed through the branch to accounts belonging to non-Estonian customers including Russian clients. However, the bank has not confirmed how much of that figure comes from suspicious transactions. It has launched an internal investigation and is expected to announce the results on Wednesday, Sept. 19.

Discriminating Email

Denmark’s Largest Bank Took Two Years to Close Accounts of Blacklisted Russian ClientsAccording to the Wall Street Journal, an April 2013 email reveals that the bank’s anti-money laundering (AML) chief based in Denmark had asked colleagues in the Estonian branch “about client accounts whose owners appeared on a blacklist generated by Russia’s central bank.” The Bank of Russia keeps a database of individuals and companies suspected of financial wrongdoing which it shares across borders. The list currently has about 500,000 names.

The Estonian Financial Supervision Authority (FSA) said on Tuesday that “it repeatedly complained to Danish counterparts about the branch’s blacklisted customers,” the news outlet conveyed, adding that in a 2013 email, Niels Thos Mikkelsen, the bank’s then-compliance executive, wrote:

They have the impression that we do not take the issue seriously.

Denmark’s Largest Bank Took Two Years to Close Accounts of Blacklisted Russian Clients
Thomas Borgen.

Furthermore, the news outlet added that a spokesman for the Danish FSA pointed out that a reprimand ruling against Danske Bank in May states that the authority received “misleading” information from the bank between 2012 and 2014. Danske claims the information came from the branch.

While the Financial Times recently reported that Thomas Borgen, the bank’s CEO, was notified in October 2013 about suspicious transactions at the Estonian branch, Borgen insists that “he was not informed in detail at the time about the problems,” Reuters described on Tuesday, elaborating:

The Danske Bank case has led to speculation in Denmark that its chief executive Thomas Borgen, who was in charge of its international operations, including Estonia, between 2009 and 2012, will step down.

Why do you think the regulators are after crypto when they let Danske Bank service blacklisted clients for two years? Let us know in the comments section below.


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$150B Money Laundering Probe of Danske Bank Implicates Citigroup and Deutsche Bank

$150B Money Laundering Probe of Danske Bank Implicates Citigroup and Deutsche Bank

U.S. law enforcement agencies have started their money laundering investigations of Danske Bank, Denmark’s largest bank, according to the Wall Street Journal. Citigroup and Deutsche Bank have been implicated. Danske Bank is also currently under investigation by Denmark and Estonia and its CEO reportedly ignored warnings of suspicious transactions.

Also read: 160 Crypto Exchanges Seek to Enter Japanese Market, Regulator Reveals

$150 Billion Money Laundering Case

$150B Money Laundering Probe of Danske Bank Implicates Citigroup and Deutsche BankThe Wall Street Journal reported on Friday, September 14, that “The [U.S.] Justice Department, Treasury Department, and Securities and Exchange Commission [SEC] are each examining Danske Bank after a confidential whistleblower complaint was filed to the SEC more than two years ago,” citing a person familiar with the matter. According to the person and the documents the news outlet has reviewed:

U.S. law enforcement agencies are probing Denmark’s largest bank over allegations of massive money laundering flows from Russia and former Soviet states…U.S. involvement in the case greatly raises the stakes for Danske Bank.

$150B Money Laundering Probe of Danske Bank Implicates Citigroup and Deutsche BankAn estimated $150 billion are suspected to have flowed through non-Estonian customer accounts held at Danske Bank’s Estonian branch from 2007 to 2015 – from countries such as Russia, Azerbaijan, and Moldova. The publication added that the bank’s investigators have not revealed if the entire amount should be viewed as suspicious. The bank has been conducting an internal investigation and will release the results on September 19, a notice on its website states.

Danish and Estonian authorities have been investigating the bank and have shared information with their U.S. counterparts, several European officials familiar with the matter told the news outlet.

Why Is the US Interested?

The U.S. has yet to officially confirmed that it is investigating Danske Bank. Two weeks ago, Marshall Billingslea, U.S. Department of the Treasury’s Assistant Secretary for Terrorist Financing, told Danish daily Berlingske “We are following this case very closely.” Reuters elaborated:

While the bank does not have a banking license in the United States, it has a bond program in dollars and its Estonian branch saw U.S. dollar customer flows, which could heighten interest among U.S. regulators.

The Wall Street Journal explained that the U.S. Treasury can restrict the supply of U.S. dollars to foreign banks and the Treasury and Justice Department can fine banks.

Adam Barrass, an analyst at Berenberg, noted back in July that the key risk to Danske Bank was “the potential U.S. fine because [of] Danske’s use of dollar funding and transactions,” the Financial Times reported.

CEO Ignores Money Laundering Signs

According to the Financial Times, Danske Bank’s CEO, Thomas Borgen, ignored calls to scale back business at the Estonian branch when warned of money laundering activities. The minutes seen by the news outlet reveals that the CEO was informed at a meeting in October 2013 that:

The level of activity in its [Danske Bank’s] Estonian branch from outside the country — mostly from ex-Soviet states and Russia — was higher than that of rivals and ‘needed to be reviewed and potentially reduced’.

$150B Money Laundering Probe of Danske Bank Implicates Citigroup and Deutsche Bank
Danske Bank’s CEO, Thomas Borgen.

Instead, Borgen responded by emphasizing “the need for a middle ground, and wanted to discuss this further outside of this forum,” the publication noted.

The Wall Street Journal additionally detailed, “Estonian officials are investigating 26 former Danske employees, from low-level staff to the former branch CEO. They are accused of helping to launder $230 million in money from an alleged fraud committed in Russia.”

Deutsche Bank and Citigroup Implicated

Citing the person familiar with the probes, the Wall Street Journal also reported:

The whistleblower complaint identified Deutsche Bank AG and Citigroup Inc., both overseen by U.S. regulators, as involved with transactions into and out of Danske Bank’s Estonian branch.

Deutsche Bank acted as a correspondent bank for Danske, handling dollar wire transfers while Citigroup’s Moscow office was involved in some of the transfers through Danske Bank’s Estonian branch, the person told the publication.

With the ongoing probes, the bank’s share price has been on a sharp decline this year.

$150B Money Laundering Probe of Danske Bank Implicates Citigroup and Deutsche Bank

Why are regulators going after crypto with so much money laundering going on in the banking system? Tell us what you think in the comments section below.


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Denmark’s Largest Bank May Have Facilitated up to $150 Billion in Money Laundering

Denmark’s Largest Bank May Have Facilitated up to $150 Billion in Money Laundering

Companies from Russia and other parts of the former Soviet Union have apparently turned the small country of Estonia into a massive money laundering haven. An investigation into the Estonian branch of Denmark’s largest bank is examining up to $150 billion which may have been involved.

Also Read: The Daily: Robinhood Aiming for IPO, Dodgers to Give Away Crypto Tokens

From $3.9 Billion to $150 Billion

Denmark’s Largest Bank May Have Facilitated up to $150 Billion in Money LaunderingInvestigators at Danske Bank (CPH: DANSKE), the largest bank in Denmark, are reportedly combing through a whopping $150 billion worth of transactions that passed through its Estonian branch between 2007 and 2015. While its likely not all of the suspicious funds are from an illegal source, this is a jump by an order of magnitude from the bank’s initially suspected figure said to be involved with money laundering by Russian and other Eastern European companies.

Last year Danish media sources reported the suspected laundered funds at $3.9 billion but in early July the figure jumped to between $8 and $9 billion. And earlier this month, FT reported that up to $30 billion may be suspect. The bank’s stock price has taken a considerable hit from the revelations.

“Any conclusions should be drawn on the basis of verified facts and not fragmented pieces of information taken out of context,” Danske Bank chairman Ole Andersen told the Wall Street Journal which brought up the $150 billion figure. “As we have previously communicated, it is clear that the issues related to the portfolio were bigger than we had previously anticipated.”

Weak Deterrence?

Denmark’s Largest Bank May Have Facilitated up to $150 Billion in Money LaunderingAccording to Estonian law, an individual may face up to ten years in jail for taking part in an organized money laundering crime. However, a company guilty of money laundering faces a maximum penalty of just 16 million euros.

Back in July, the bank’s Board announced it intends to waive all income from suspicious transactions in Estonia and use it “to the benefit of society,” like supporting efforts to combat financial crime. “It is still too early to draw any conclusions regarding the extent of the issues, as the comprehensive investigations into the matter are still ongoing. However, it is clear that we did not live up to our own standards or the expectations of society at large when it came to preventing our Estonian branch from being used for potentially illegal activities at the time when these transactions took place. This is something we deeply regret and which we should not benefit from financially in any way. Therefore we will not keep the income from these suspicious transactions,” CEO Thomas F. Borgen, said at the time.

Why are regulators going after crypto with so much money laundering going on in the banking system? Share your thoughts in the comments section below.


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Danish Ice Hockey Stadium Rebrands to ‘Bitcoin Arena’ as Awareness Grows

Earlier this year, the Rungsted Seier Capital ice rink in Denmark was rebranded to Bitcoin Arena by co-owner Lars Seier Christensen and billionaire sponsor Niklas Nikolajsen. The two individuals that oversee the operations of the stadium said that they were keen on rebranding it to spread awareness of bitcoin. Nikolajsen emphasized that he and his … Continued

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Saxo Investment Bank is Bullish on Crypto Over Next 3 Months

Saxo Investment Bank is Bullish on Crypto Over Next 3 Months

Influential investment bank Saxo released the 35 page, Q2 2018 Quarterly Outlook. In it, the bank’s newly hired Crypto Analyst, Jacob Pouncey, noted the perils of this year’s first financial quarter with regard to digital assets. Taking into account several factors, he believes the next three months could be a breakout time for digital assets, holding the potential to trigger a bull market.

Also read: German Cops Look Hard at Antics of ICO Savedroid After Ghost Prank

Heavy Hitter Saxo Bank Released Bullish Outlook on Cryptocurrencies

It takes all of 33 pages to find it, but there it is: a very influential investment bank not only hired a “Crypto Analyst,” but allowed him to have an authored section titled – Are Cryptocurrencies Entering a New Cycle?

The Danish bank, Saxo, forwarded its general outlook for 2018’s second set of three months. Turning to cryptos, Mr. Pouncey prefaced, “Cryptocurrencies fell back to earth with a bang in the first months of this year, having enjoyed exponential growth in 2017. The situation remains fragile, given the outlook to increased regulation and social media advertising bans. That said, we can’t rule out the possibility of a comeback.”

Saxo is based in Copenhagen, and its products include online trading in futures spreads, funds, bonds, CFDs, stocks, and even a foreign exchange. It has the rare charter of being both a proper bank and a broker. As such, it typically caters to institutional, legacy financial companies (more than 100 globally). Its European presence is well established, though it has exposure in the Middle East and Southeast Asia. Saxo claims to handle $12 billion USD daily, having clients in 180 countries.  

Saxo Investment Bank is Bullish on Crypto in the Next 3 Months

That its main analyst in the crypto sector is optimistic going forward means cover for institutional investors who’re looking to dabble. Indeed, Mr. Pouncey details, “The market has seen several acquisitions of crypto exchanges from financial firms such as Goldman Sachs backed Circle acquiring Poloniex, Monex Group acquiring Coincheck, and Yahoo Japan buying a 40% stake in Bitarg Exchange Tokyo.” Additionally, crypto exchanges such as Coinbase have been able to recruit real talent from Silicon Valley, and they’re being placed in key executive positions. These moves seem poised to take advantage of price spikes.

Mr. Pouncey concludes, “several events could serve as springboards for a cryptocurrency bull market in Q2, whether it is through fundamental drivers, or it is just a self-fulfilling prophecy [….] In my opinion, we will eventually see the end of the current, negative cryptocurrency cycle, as many of the weak hands have been shaken out by the bear market and the remaining investors are on the ready to latch onto any good news after the bad start this year.”

Saxo Investment Bank is Bullish on Crypto in the Next 3 Months
Jacob Pouncey

Much of the Positive Outlook is Based on Institutional Investors Entering the Crypto Space

Many professional financial legacy gurus expect the easy credit market to dry up a bit in the coming months as a hedge against inflation. This could mean traditional equities are less attractive, and the search for “uncorrelated assets” begins.

These are “assets that lie outside the reach of the traditional financial system in which cryptocurrencies are a potential alternative,” Mr. Pouncey insists. “Historically, many of the blue chip cryptocurrencies have seen price increases in the face of global uncertainty and [… the] inflow of institutional capital to the cryptocurrency market due to the increase in regulation and investor protection could lead cryptocurrencies to a positive quarter.”

Do you believe institutional investors are going to enter the crypto market soon? Let us know in the comments section below.


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Bitcoin in Brief Monday: A Panther’s Moonshot Bet

Bitcoin in Brief Monday: A Panther’s Moonshot Bet

Bitcoin in Brief today is slanted toward a crypto winter slowly thawing, as Pantera Capital bets on a moonshot price point. Also, the world’s most popular decentralized digital asset has been forked more than a plate of good pasta; there’s a growing list of countries who’re less likely to nab your crypto profits; Yahoo! smashes rumors; and a good-hearted wager between bitcoin core and bitcoin cash partisans exemplifies how ecosystem actors should treat one another.

Also read: Bitcoin in Brief Saturday: Hide Your Seed

A Panther’s Moonshot

Bulls have a panther as their advocate to help thaw this crypto winter. We reported this week, “Pantera Capital, an investment firm exclusively operating in the cryptocurrency and distributed ledger technology sectors, has published a letter predicting that bitcoin has established the low for its current bear market. Pantera cites a number of factors as informing its market outlook.”

Bitcoin in Brief Monday: A Panther’s Moonshot Bet

Among those factors are taxes on capital gains, where estimates are in the many, many billions expected from enthusiasts. That in turn, the fund theorizes, dragged prices down, and bitcoin core has found a bottom at $6,500, as holders were forced to sell in order to pay government bills. We continue, “Pantera also states that ‘It’s highly likely’ for the price of bitcoin to exceed its previous record highs of $20,000 ‘within a year,’ asserting that ‘A wall of institutional money will drive’ the growth in price.”

Speaking of Taxes

Until that prediction comes true, readers should pack their bags to save money from the tax man! Start looking for places to stay in Germany, Slovenia, Denmark, Belarus, South Korea, Singapore, as they’re some of the most advantageous.

Bitcoin in Brief Monday: A Panther’s Moonshot Bet

We stressed how many “jurisdictions have yet to update their tax laws to encompass cryptocurrencies. Rules governing taxation are often incoherent and very different even in countries that are part of a common space. In the European Union, for instance, tax rates in member-states vary between 0 and 50%.”

Forking Crazy

Be honest. You’ve never heard of Bitcoin Minor, Bitcoin King, nor Bitcoin Boy. How many times would you guess the Bitcoin network has been forked? During an extensive and really interesting investigation, we revealed nearly 70 times. That’s right, 70.

We summarized findings as how forking “bitcoin used to be a rarity. Then it became the norm. And then it became a meme, with anyone and everyone forking bitcoin on a weekly basis. There have now been a total of 69 bitcoin forks plus another 18 altcoin forks. Holders of bitcoin, monero, ethereum, and litecoin can claim almost 80 additional coins for free. Whether it’s worth their time to do so, however, is another matter.”

The Fork of All Forks Remains a Solid Option

The most famous of forks is, of course, bitcoin cash (BCH). Its being faster, sleeker, younger, and bigger (block wise) has lead those on the bitcoin core (BTC) side to take a stance on BCH’s long term viability. And while each side feels passionate about its coin, and the future that it entails, debate often become rancorous, turning everyone off.

Bitcoin in Brief Monday: A Panther’s Moonshot Bet
A reader responds to a hilarious bet.

We reported how two well-known advocates joked and ribbed one another about Core’s anticipated Lightning Network solution. They bet bragging rights if a demonstration of the solution failed a basic transaction. Loser would have to wear a t-shirt of the winner’s coin. Regardless of which won, the import is how the two men exchanged laughs and good humor, and the ecosystem needs more of both.

Japan Continues to Lead

No laughing matter is how the crypto winter continues its thaw as “Yahoo! Japan has confirmed that it is entering the crypto space by acquiring a stake in a Japanese cryptocurrency exchange that is already licensed by the country’s financial regulator. The company plans to launch a crypto exchange in the fall of this year,” we explained.

Bitcoin in Brief Monday: A Panther’s Moonshot Bet

We Have the Best Readers in All of Crypto

Thanks to our readers liking and sharing, our post on aspects of Islam possibly opening to cryptocurrency was picked up and republished and referenced around the world. Some contend it was the root cause of bitcoin’s recent price rebound. Great job, gang.

The crazy good book by Wendy McElroy we continue to serialize brings in wonderful reader comments and observations. To wit:

Bitcoin in Brief Monday: A Panther’s Moonshot Bet

Do you think bitcoin will continue to rise or to fall to new lows? Let us know in the comments section below.


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These Countries Won’t Tax Your Bitcoins Too Much

These Countries Won’t Tax Your Bitcoins Too Much

A growing number of governments can’t resists the temptation to get their hands on some of the bitcoins their citizens are making. Several states, however, think that leaving some breathing space for crypto users and entrepreneurs is a better idea in the long run. Crypto-friendly tax regimes can still be found around the world.

Also read: Tax Paying Americans Owe $25 Billion in Cryptocurrency

Tax Exemptions Offered Here:

Germany, Europe’s economic locomotive, has been quite careful with crypto taxation. Last month the Federal Ministry of Finance issued a notice which treats bitcoin as a currency. The Bundesrepublik is not going to tax cryptos when exchanged with euros. Purchases with bitcoin are subject to VAT, just like any other. No tax will be imposed, however, on long-term investments in cryptocurrency. If a trader sells a bitcoin more than a year after its purchase, the profit is exempt from taxation. The same applies to yearly profits of less than €600.

These Countries Won’t Tax Your Bitcoins Too MuchCapital gains of individual investors trading cryptocurrencies are not taxed in Slovenia. Its residents are not required to report them in their income tax returns. However, private individuals who receive their income in cryptocurrency, are obliged to declare the digital money and pay regular income tax. The country uses a progressive scale and rates vary from 16% on incomes of less than €8,000 a year to 50% on incomes exceeding €70,000.

Tax authorities in Denmark have said that fintech companies should pay taxes just like any other business. On the other hand, individual investors trading cryptos do not owe any tax on their gains.

Belarus has created a friendly environment for crypto investors, both corporate and private. Activities like mining, issuing, and trading coins were legalized in March. A presidential decree introduced tax exemptions for crypto incomes and revenues for a period of five years.

These Countries Won’t Tax Your Bitcoins Too Much

Gains from cryptocurrency transactions are still tax free in South Korea. The Finance Ministry and the tax authorities in Seoul are working on a legislation that is likely to change the situation. The new tax bill should be adopted in the first half of this year, according to officials. No concrete time frame has been set.

Buying bitcoin will save you taxes in Singapore. Digital coins are not considered commodities there and are not recognized as currencies. In the absence of special requirements, gains from crypto investments of private individuals are not taxed. Companies trading cryptocurrencies, however, are expected to pay taxes on their profits.

Incoherent Rules Govern Crypto Taxation

These Countries Won’t Tax Your Bitcoins Too MuchMany jurisdictions have yet to update their tax laws to encompass cryptocurrencies. Rules governing taxation are often incoherent and very different even in countries that are part of a common space. In the European Union, for instance, tax rates in member-states vary between 0 and 50%.

The Eurasian Economic Union is another example, with Belarus exempting crypto transactions from taxation, while Russia is collecting 13% tax on crypto incomes and 24% corporate tax on profits.

The situation in the US is also complicated. Several states have taken steps to become crypto-friendly jurisdictions. Wyoming passed a bill exempting cryptocurrencies from property taxation. Two other states want to legalize bitcoin as a payment option for tax purposes. Arizona has promised to become the first US state to start accepting taxes in cryptocurrency. Georgia may also allow its residents to pay taxes in bitcoin.

What taxes on crypto incomes and profits do you have to pay in your country? Tell us in the comments section below.


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The post These Countries Won’t Tax Your Bitcoins Too Much appeared first on Bitcoin News.

Ethereum Drama, More Bans and Lawsuits: This Week in Crypto

Make sure you check out last weeks post here, now let’s go over what happened in crypto this week.  Price Watch: Bitcoin is down 20% this week completely retracing the past week’s gains. Despite periodic gains this week, the market still finished down significantly from last week posting another double-digit loss. This has been attributed to everything … Continued

The post Ethereum Drama, More Bans and Lawsuits: This Week in Crypto appeared first on CCN

0 to 50% – Time to Pay Crypto Taxes in the European “Union”

0 to 50% – Time to Pay Crypto Taxes in the European “Union”

With the increasing popularity of bitcoin and the like, this year’s tax campaign in Europe comes with many questions on how to report and pay crypto taxes. Despite the obvious hesitation on the part of many governments to comprehensively regulate/legalize the sector, cryptocurrency incomes and profits “enjoy” special attention. Different decisions on the matter pose different challenges to citizens of individual member-states.

Also read: Excessive Crypto Regulation Not Optimal, EU Banking Authority Says

Different Approaches

There is no uniform approach towards cryptocurrencies in any region and Europe is no exception when it comes to taxation. The recently held G20 summit proves no global consensus on the status of cryptocurrencies, and each jurisdiction is expected to take its own decisions in the short run. In the absence of pan-European guidelines on how to treat crypto-related incomes and profits, some member-states follow a decision by the Court of Justice of the EU. In a 2015 ruling on the application of value added tax (VAT) to cryptocurrencies, the Luxembourg-based institution set a precedent. It basically drew a parallel between “virtual currencies” and fiat money, when digital coins are used for payments.

0 to 50% – Time to Pay Crypto Taxes in the European “Union”In accordance with that decision, Germany’s Federal Ministry of Finance recently announced that bitcoin should not be subject to VAT, when exchanged with fiat. The tax is applicable only when goods and services are paid for in cryptocurrency. According to German authorities, exchanges can enjoy tax breaks when they trade cryptos, and crypto mining should not be taxed. Trading cryptocurrencies by individuals, however, is subject to standard capital gains tax. Profits of less than €600 and gains from long term holdings (over one year) are exempted.

Several other governments have adopted similar rules. Estonia subjected digital currencies to capital gains tax and VAT. Authorities in Tallinn view cryptos as both means of payment and investments. Slovenia does not tax capital gains of individual investors trading cryptocurrencies, as they are not considered part of their income. Crypto incomes, however, for both individuals and businesses, should be reported and taxed. Applicable rates depend on the annual income and vary from 16% for less than €8,000 to 50% for incomes over €70,000 a year.

Tax authorities in Denmark have announced that crypto companies will be taxed as any other business. According to the Financial Services Authority, private individuals trading cryptocurrencies will not be required to pay taxes. The agency called for adopting legislation that regulates cryptos and their taxation. Spain is mulling tax breaks for businesses using blockchain technologies and cryptocurrencies. The exact scope of the exemptions is yet to be determined, but the ruling People’s Party has introduced a bill to offer incentives for small companies in the crypto sector.

Waiting for Brussels’ Decision

0 to 50% – Time to Pay Crypto Taxes in the European “Union”A number of EU countries are still waiting for a common, European approach towards cryptocurrency taxation. The government in Belgium, which is home to many EU institutions, has not issued an official stance on the matter. Nevertheless, recent reports suggest that tax authorities are going after Belgian citizens trading cryptocurrencies on foreign exchanges. Anyone speculating on crypto markets is expected to pay 33% tax on their gains, despite the fact that cryptocurrencies are not regulated. Belgians should declare them as “other income” on their tax returns, the Special Tax Inspectorate said at the end of last year.

Bulgaria is another member-state expecting guidance from Brussels. The National Revenue Service has issued a clarification notice saying 10% capital gains tax is applicable to profits from buying and selling cryptocurrencies. Their legal status, however, is yet to be determined by the Bulgarian parliament. It remains unclear how bitcoin incomes and purchases with cryptocurrency will be taxed.

Other EU member-states are losing patience. Dutch finance minister recently described the current regulatory framework as “insufficiently equipped”, as news.Bitcoin.com reported. Wopke Hoekstra spoke of the “inherently cross-border” nature of cryptocurrencies and called for “coordinated international approach”. The government in the Netherlands insists on adopting new European regulations by the end of next year, including amendments to the anti-money laundering directive, which also deals with tax evasion.

The European Neighborhood

While EU regulators are still struggling to grasp the crypto phenomenon, other countries in Europe have taken advantage of their non-aligned status. Belarus, for example, is fighting political and economic isolation by embracing crypto. A decree, signed by President Lukashenko, introduces tax breaks and other incentives for crypto-related activities until 2023. It enters into force in less than a week, on March 28. Whether this crypto-friendly policy will fill government coffers at the end of the day remains to be seen.

How are crypto incomes and profits taxed in your country? Tell us in the comments section below.


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The post 0 to 50% – Time to Pay Crypto Taxes in the European “Union” appeared first on Bitcoin News.