14/11/24

EU: Dutch Efforts to Enhance EU Crypto Tax Laws

As published on: nltimes.nl, Friday 15 November, 2024.

The EU is only as strong as the nations that make it. The vision of a unified legal, cultural, and economic landscape is only possible if all member states work together towards a common goal. Crypto has been a dividing factor for many years, as some countries are very reluctant, others cautious, and the rest optimistic about its incorporation, adaption, and application. But, those years are long gone, and the EU is on a fast track for crypto acceptance and legislature. While the attempt to confine crypto within the strict borders of laws and regulations may seem counter-intuitive to cryptos' true nature, it's the certainty of law that attracts investors and companies, which ultimately drives crypto invocation forward.

It is precisely this crypto popularity driving forward the need for legalization and clearly defining terms, rules, and taxation methods. And the new taxation laws would encompass all crypto coins, including Bitcoin, stablecoins, and memecoins. Experts predict the local crypto market will supply $380 million before 2025 ends, marking a healthy and thriving economy. For investors, besides regulations, it's also important to notice in which crypto to invest. Altcoins for local crypto enthusiasts offer a good way to get into the crypto trading business, as they provide a fertile, but volatile, trading ground. Joren Verdoes notes that investors must separate hype from sustainable fundamentals and long-term value, as excessive hype can sometimes lead to volatility and unrealistic crypto price expectations (source: https://www.techopedia.com/nl/crypto/welke-altcoin-gaat-exploderen).

As the Dutch market starts sharing its crypto data with other members of the EU, we'll see a rise in regulated market trade and more crypto safety.

The proposed new law would require all local crypto providers and similar services to share their data with the Dutch tax authorities, who in turn share their data with the EU. Such a bold move would significantly reduce the chances of traders getting tricked or their assets stolen by malicious third parties, as the crypto network would become richer for all the data shared with all of its EU members.

The new law would perfectly fall in line with the current EUs DAC8: reporting rules on crypto-asset transactions and would make them more transparent and thus safe. While opposition cites that taxation would lower the revenue people can get from trading crypto, the added safety, regulation, and certainty are more than enough to counterpoint their stance.

Crypto markets are notoriously volatile and subject to daily change. There is no lack of hackers and attackers wishing to capitalize on the vast sums of money tied to crypto, so any step toward regulation and safety is welcome in that regard. The proposition does not stop at EU-only members. With the OECD’s crypto-asset reporting framework in place, all of the local information would be shared with the UK and US, and vice-versa, making the data exchange complete.

The benefit of even more and larger countries joining to raise crypto safety and provide a healthy environment will echo positive outcomes for all users in the coming years. This big change would also signal that the Dutch crypto market is ready for its next step and that they are taking traders' safety seriously.

Tags

EU Netherlands Crypto