Cryptocurrencies Admitted in Latvia in order to be Taxed

Aimed to gain its share of the profits, the Latvian government might accept cryptocurrencies as a legal means of exchange
13 April 2018   1346

Tax filing campaign of 2018 is taking place and authorities don’t have much time. Two parliamentary committees and the Ministry of Finance have revealed their views on the matter this week. Latvians may owe the state tax on their gains from crypto transactions very soon.

Some lawmakers admonished to their colleagues and constituents that cryptocurrencies are not considered a legal proposal in the Baltic state and come with speculative bubbles and financial pyramids. Members of the Financial and Capital Markets Committee, nevertheless, noted that cryptos can “function as a means of exchange”.

The Ministry of Finance claimed that the Latvian government is thinking comprehensive cryptocurrency regulations. The Prime-Minister`s working group stated by Māris Kučinskis has been directed to prepare the proposals. It is going to  study market risks, but also evaluate potential benefits associated with cryptocurrencies.

Cryptos are being strongly criticised by the Latvian politicians for failing to perform one or more of the functions of fiat money – means of payment, medium of exchange, unit of account, and store of value. The “means of exchange” labeling now gives Latvian officials a possibility to tax cryptocurrency transactions. Maybe if they think about VAT, a “means of payment” status will also be attributed. No tax is presently due on crypto purchases of goods and services in Latvia.

There is no Latvian law to regulate cryptocurrencies like Bitcoin but authorities in Riga say revenues from crypto trading are subject to personal and corporate income tax. The country has a flat income tax rate of 23%. Incomes from dividends and interest are taxed at 10%. 15% tax is due on capital gains from shares, real estate, and intellectual property. The standard rate of Value Added Tax is 21%. Financial transactions are released from VAT. Tax returns in Latvia are filed between March 1 and June 1 of the year following the taxation year.

Bakkt to Unveil Bitcoin Futures Test Date

Along with date announcement, COO Bakkt believes the platform will attract institutional investors and set new standards for the cryptocurrency market
14 June 2019   203

The Bakkt cryptocurrency platform has named the exact start date for testing Bitcoin futures. The first users will be allowed to test the tool on July 22.

According to Bakkt's Operations Director, Adam White, the platform will attract institutional investors and set new standards for the cryptocurrency market.

White pointed out that the wider distribution of cryptocurrencies, in particular, is hampered by unreliable pricing mechanisms and the likelihood of instantly falling rates.

Along with these problem-solving solutions that are new to digital asset markets, Bakkt also brings all the other features that institutions would expect in a versatile and broadly accessible market, including: block trades; a fee holiday through the end of the year to encourage trading; market maker incentive programs to encourage liquid markets; and integrations with ISVs and regulated brokerage platforms.
 

Adam White

COO, Bakkt

At Bakkt, two futures contracts will be presented - with daily and monthly settlements. Risk management and the securing mechanism for these contracts will meet the standards of the traditional derivatives market.