Cryptocurrency investors are facing a tricky and fast-changing tax landscape worldwide with sparse guidance in many areas, PricewaterhouseCoopers (Pwc) has learned.
According to the auditing giant, businesses that are pushing the boundaries of the technology to explore new business models are often faced with significant tax uncertainty.
PwC Tax Partner in Hong Kong, Peter Brewin, believes the situation with the crypto market taxation is moving quickly despite "a lack of guidance."
"Tax authorities and policymakers are still learning about how much of the industry works. We expect the rate of change in the tax landscape to be as fast as it is for the crypto industry over the coming years," Brewin added.
PwC also found that most jurisdictions are trying to fit digital asset "into existing capital gains tax regimes."
The audit corporation claims that the most common treatment is to consider digital assets as a type of property:
"Often this means that spending these for acquiring goods and services leads to a tax charge on disposal."
Earlier this year, PwC released a report that revealed that most of the mergers and acquisitions in the crypto industry as well as fundraisings are taking place outside the US.
According to the document, fundraisings and mergers in the APAC (Asia-Pacific) and EMEA (Europe, Middle East and Africa) regions accounted for a total of 51% of all fundraisings and mergers last year with 29% and 22%, respectively.
Access more than 50 of the world's financial markets directly from your EXANTE account – including NASDAQ, London Stock Exchange and Tokyo Stock Exchange.