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Privacy coins surge after US and Australia target crypto gains

The price of several privacy coins like Monero, ZCash, Horizen and Dash all experienced a surge of up to 22% after the Australian Tax Office (ATO) warned traders who do not deduct tax from their crypto gains that they can track taxable cryptocurrency transactions.

In a press release published May 28 on ATO’s official website, Assistant Commissioner Tim Loh announced:

‘This year, we will be writing to around 100,000 taxpayers with cryptocurrency assets, explaining their tax obligations and urging them to review their previously lodged returns. We also expect to prompt almost 300,000 taxpayers as they lodge their 2021 tax return to report their cryptocurrency capital gains or losses.’

Loh also mentioned that ATO finds it alarming how many investors think crypto is independent of tax. ‘We are alarmed that some taxpayers think that the anonymity of cryptocurrencies provides a licence to ignore their tax obligations,’ Loh said.

He further elaborated in the statement that ATO monitors every cryptocurrency trade that happens in the country.

‘While it appears that cryptocurrency operates in an anonymous digital world, we closely track where it interacts with the real world through data from banks, financial institutions, and cryptocurrency online exchanges to follow the money back to the taxpayer,’ he said.

Following the statement above, the price of the most popular and trusted privacy coin, Monero rallied from US$220 to a price of almost US$300 on the morning of May 29.

This sudden increase in the price of Monero was likened to its 30% surge last May 21 after the US Treasury announced that all transfers above US$10,000 must be reported to the Internal Revenue Service (IRS) starting 2023 regardless if it’s an online transaction.

In a Forkast interview, Head of Exchange Sales in cryptocurrency exchange EQUOS, Justin d’Anethan said that the anonymity provided by coins like Monero makes it an attractive asset to traders who want to keep their trading activities private and their taxable cryptocurrency profits hidden from tax regulators.

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