Virtual Currencies— How To Tax Profits?

During the past year Bitcoin doubled its value. Those who acquired this currency at a lower rate can now reap great profits. The ability to tax income on this basis has long been subject to doubt. Recently, a change of statistical classification of trade in Bitcoin augmented uncertainty in this regard.

What are virtual currencies?

We wrote about the legal aspects of virtual currencies in our report on 2014. Since that time, no legal definition of virtual currencies, which are now increasingly referred to as "digital currencies," has appeared. However, this will soon probably change, as we wrote in our article Draft bill on a Central Database of Accounts. Work on creating a definition of "virtual currencies" has also been underway at the EU level, about which we wrote in an article in August 2016.