Bitcoin rose to a peak of nearly $12,500 Monday morning, its highest since June 2019, and remained above $12,000 for about 24 hours before a 7% pullback Tuesday and Wednesday. Cryptocurrency executive Marouane Garcon expects the decline to be a “brief pause,” adding that “we’re definitely in a bull market.”
Former Prudential Securities CEO George Ball changed his previously skeptical tune on bitcoin, recommending investors buy it now, “before the fuse is lit.” Other major cryptocurrencies trailed bitcoin this week, and Chainlink sunk more than 25% from its peak last weekend.
ALLEGED UBER COVER-UP
Joseph Sullivan, Uber UBER -1.8%’s former chief security officer, was charged with obstruction of justice for an attempted cover-up of a massive 2016 security breach, the Department of Justice announced Thursday. Instead of reporting the hack, which compromised personal information for about 57 million Uber users and drivers, Uber allegedly paid the hackers off with $100,000 worth of bitcoin while Sullivan misled the Federal Trade Commission’s investigation.
CAN BITCOIN BE SUED?
In the civil action filed in connection with the IRS’ seizure of bitcoin owned by terrorist groups last week, the named defendants aren’t people or companies; instead, the lawsuit was filed against 155 bitcoin accounts. In rem jurisdiction like this is common in asset forfeiture cases and has been applied in the past to civil suits involving dinosaur bones, shark meat and a red Lamborghini, but it remains murky whether the same rules apply to an intangible asset like bitcoin.
TAX TIPS
The IRS released a draft of the Form 1040 that filers will have to fill out next year, and the question about whether individuals have bought or sell any cryptocurrencies was moved to a more prominent position, signaling that the IRS is getting even more serious and ready to take action on cryptocurrency reporting.
You can mitigate your tax obligations by taking advantage of low long-term capital gains rates, rolling over profits into opportunity zones or donating some of it. But it’s important to do careful planning before donating any cryptocurrency holdings to maximize the benefit.
BITCOIN GLOBALIZATION
Hip-hop star Akon is ready to start building a “futuristic cryptocurrency themed city” in Senegal after claiming to have secured $4 billion from investors. Built on land donated by the government, Akon City will exclusively use a new digital currency called Akoin. Phase 1 of construction is expected to be completed by 2023, and plans for phase 2 run from 2024 to 2029.
Africa is a continent often ignored by traditional financial services where crypto enthusiasts are optimistic digital assets have a chance to go thrive. Nigeria-based bitcoin-buying service Yellow Card raised $1.5 million in a seed funding round that included heavyweights like Polychain and Andreessen Horowitz. CEO Chris Maurice predicts “crypto will go mainstream in Africa long before any other part of the world.”
ELSEWHERE
In a world where central banks issue digital currencies, bitcoin and Libra may find a place [CNBC]
Bitcoin Has Lost Its Way: Here’s How to Return to Crypto’s Subversive Roots [CoinDesk]
Crypto Assets of $50 Billion Moved From China in the Past Year [Bloomberg]
Read more at: https://www.forbes.com/sites/cryptoconfidential/2020/08/23/bitcoin-pullback-ubers-bitcoin-ransom-allegation/#1b9ddc6478fe
