Commodity vs. Currency

1

Some countries view Bitcoin as a commodity, some see it as a currency (and some ban it, but that's another story).

I read a few articles, but in layman's terms, what are the main differences about a commodity and a currency?

Basj

Posted 2017-10-28T17:07:21.520

Reputation: 354

Answers

1

I found this on a Quora. Hope it helps.

Property

Pro:

It is eligible for long-term capital gains tax treatment, if held for more than one years (which is a huge benefit). The US has very favorable capital gains taxes.

Con:

Every purchase made with bitcoin will be a capital gain or a capital loss that must be tracked, even if the purchase price is denominated in bitcoin.

Currency

Pro:

Money spent with bitcoin on bitcoin-priced goods & services would not give rise to a separate taxable transaction. Theoretically one could benefit from bitcoin appreciation and never be taxed upon that appreciation.

Con:

Conversion of bitcoin to other currencies would give rise to taxable income, if a gain occurs, and losses would be unrecoverable (for individuals).


I think coin.dance (your link) is not 100% up to date.

Zauz

Posted 2017-10-28T17:07:21.520

Reputation: 240