{"id":205497,"date":"2021-03-18T20:21:00","date_gmt":"2021-03-18T17:21:00","guid":{"rendered":"https:\/\/en.buradabiliyorum.com\/would-a-us-wealth-tax-push-millionaires-to-bitcoin-adoption\/"},"modified":"2021-03-18T20:21:00","modified_gmt":"2021-03-18T17:21:00","slug":"would-a-us-wealth-tax-push-millionaires-to-bitcoin-adoption","status":"publish","type":"post","link":"https:\/\/buradabiliyorum.com\/en\/would-a-us-wealth-tax-push-millionaires-to-bitcoin-adoption\/","title":{"rendered":"# Would a US wealth tax push millionaires to Bitcoin adoption?"},"content":{"rendered":"<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_85 counter-hierarchy ez-toc-counter ez-toc-custom ez-toc-container-direction\">\n<p class=\"ez-toc-title\" style=\"cursor:inherit\">Table of Contents<\/p>\n<label for=\"ez-toc-cssicon-toggle-item-6a3bbf356fdf2\" class=\"ez-toc-cssicon-toggle-label\"><span class=\"\"><span class=\"eztoc-hide\" style=\"display:none;\">Toggle<\/span><span class=\"ez-toc-icon-toggle-span\"><svg style=\"fill: #dd3333;color:#dd3333\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"list-377408\" width=\"20px\" height=\"20px\" viewBox=\"0 0 24 24\" fill=\"none\"><path d=\"M6 6H4v2h2V6zm14 0H8v2h12V6zM4 11h2v2H4v-2zm16 0H8v2h12v-2zM4 16h2v2H4v-2zm16 0H8v2h12v-2z\" fill=\"currentColor\"><\/path><\/svg><svg style=\"fill: #dd3333;color:#dd3333\" class=\"arrow-unsorted-368013\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"10px\" height=\"10px\" viewBox=\"0 0 24 24\" version=\"1.2\" baseProfile=\"tiny\"><path d=\"M18.2 9.3l-6.2-6.3-6.2 6.3c-.2.2-.3.4-.3.7s.1.5.3.7c.2.2.4.3.7.3h11c.3 0 .5-.1.7-.3.2-.2.3-.5.3-.7s-.1-.5-.3-.7zM5.8 14.7l6.2 6.3 6.2-6.3c.2-.2.3-.5.3-.7s-.1-.5-.3-.7c-.2-.2-.4-.3-.7-.3h-11c-.3 0-.5.1-.7.3-.2.2-.3.5-.3.7s.1.5.3.7z\"\/><\/svg><\/span><\/span><\/label><input type=\"checkbox\"  id=\"ez-toc-cssicon-toggle-item-6a3bbf356fdf2\" checked aria-label=\"Toggle\" \/><nav><ul class='ez-toc-list ez-toc-list-level-1 ' ><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/buradabiliyorum.com\/en\/would-a-us-wealth-tax-push-millionaires-to-bitcoin-adoption\/#Warrens_plan\" >Warren\u2019s plan<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-2\" href=\"https:\/\/buradabiliyorum.com\/en\/would-a-us-wealth-tax-push-millionaires-to-bitcoin-adoption\/#Criticisms_abound\" >Criticisms abound<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-3\" href=\"https:\/\/buradabiliyorum.com\/en\/would-a-us-wealth-tax-push-millionaires-to-bitcoin-adoption\/#Not_a_place_to_hide\" >Not a place to hide<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-4\" href=\"https:\/\/buradabiliyorum.com\/en\/would-a-us-wealth-tax-push-millionaires-to-bitcoin-adoption\/#Better_ways\" >Better ways<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-5\" href=\"https:\/\/buradabiliyorum.com\/en\/would-a-us-wealth-tax-push-millionaires-to-bitcoin-adoption\/#An_indirect_effect\" >An indirect effect?<\/a><\/li><\/ul><\/nav><\/div>\n<p>&#8220;<strong># Would a US wealth tax push millionaires to Bitcoin adoption? <\/strong>&#8221;<br \/>\n<img decoding=\"async\" src=\"https:\/\/images.cointelegraph.com\/images\/840_aHR0cHM6Ly9zMy5jb2ludGVsZWdyYXBoLmNvbS91cGxvYWRzLzIwMjEtMDMvYzhiNDFhZGUtYjdlNi00ZDZlLWFiMzUtNDk4ZmUxNmY0ZDRlLmpwZw==.jpg\" \/><\/p>\n<div class=\"post-content\" data-v-5a136f3a>Levying a progressive tax on the ultra-wealthy has been a talking point long popular with many United States Democrats, yet such a policy would have been unimaginable under a Republican administration and a split Congress.<\/p>\n<p>Now that the Democratic Party is back in control of both the White House and Capitol Hill, the initiative is formally on the table: On March 1, a group of Democratic lawmakers led by Sen. Elizabeth Warren<a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/www.warren.senate.gov\/newsroom\/press-releases\/warren-jayapal-boyle-introduce-ultra-millionaire-tax-on-fortunes-over-50-million\"> introduced<\/a> legislation proposing an annual tax on the households and trusts worth more than $50 million, including the value of property such as real estate and stocks.<\/p>\n<p>As new bridges between traditional capital and the digital asset space emerge almost daily, highnet-worth individuals can move value to crypto with more ease than ever before. Can a prospective wealth tax, should it be codified in law, affect their willingness to do so?<\/p>\n<h2><span class=\"ez-toc-section\" id=\"Warrens_plan\"><\/span>Warren\u2019s plan<span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p>Marketed as The Ultra-Millionaire Tax, Senator Warren\u2019s bill proposes a 2% annual tax on the net worth of any household between $50 million and $1 billion, and a 3% tax for those worth more than $1 billion. The framers contend that the burden will only fall on the wealthiest 100,000 households in the nation, or the top 0.05% of wealth distribution.<\/p>\n<p>The lawmakers argue that the initiative could bring in at least $3 trillion in federal revenue over 10 years \u2014 a pool of resources that could be directed to support underfunded areas such as education, childcare and infrastructure.<\/p>\n<p>The proposed legislation would have to clear the U.S. Senate before it becomes law. Even though Democrats and Republicans are currently tied 50-50 in the chamber, with the Democratic Vice President Kamala Harris holding a tie-breaking vote, most bills still take at least 60 votes for <a href=\"https:\/\/buradabiliyorum.com\/en\/category\/download-scripts-themes-apps\/\" data-internallinksmanager029f6b8e52c=\"9\" title=\"Download Scripts &amp; Themes &amp; Apps\" target=\"_blank\" rel=\"noopener\">app<\/a>roval. As Bloomberg\u00a0<a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/www.bloomberg.com\/news\/articles\/2021-03-01\/warren-other-progressives-propose-ultra-millionaire-tax\">noted<\/a>, Democrats are at least hoping to append some elements of the tax to the budget bill that will be reconciled later in the year.<\/p>\n<h2><span class=\"ez-toc-section\" id=\"Criticisms_abound\"><\/span>Criticisms abound<span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p>It doesn\u2019t come as unexpected that the initiative received im<a href=\"https:\/\/buradabiliyorum.com\/en\/category\/social-mediaa\/\" data-internallinksmanager029f6b8e52c=\"1\" title=\"Social Media\" target=\"_blank\" rel=\"noopener\">media<\/a>te scolding from the political right and center, along with big business circles. In the weeks after the proposal went public, the Wall Street Journal ran several op-eds unpacking the reasons why the wealth tax would bring more harm than good.<\/p>\n<p>One\u00a0<a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/www.wsj.com\/articles\/warrens-wealth-tax-enriches-foreign-billionaires-11615227317\">argued<\/a> that a wealth tax for American millionaires and billionaires would affect the ownership landscape in the U.S. stock market: As big U.S. investors would be pressured to sell their most liquid assets at a discount, their counterparts from wealth tax-free jurisdictions would be happy to buy in. The author of another\u00a0<a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/www.wsj.com\/articles\/warrens-wealth-tax-would-wreak-damage-11615827079\">contended<\/a> that the outflow of capital from the stock market resulting from taxation of the ultra-wealthy would diminish the value of everyone\u2019s savings.<\/p>\n<p>Billionaire Leon Cooperman <a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/www.cnbc.com\/2021\/03\/03\/leon-cooperman-calls-sen-elizabeth-warrens-wealth-tax-foolish.html\">told<\/a> CNBC that while he believes that rich people should pay more taxes, Warren\u2019s configuration of the policy \u201chas no merit.\u201d He added: \u201cIf the wealth tax passes, go out and buy yourself some gold because people are going to rush to find ways of hiding their wealth.\u201d<\/p>\n<p>Wait, but could that gold be digital?<\/p>\n<h2><span class=\"ez-toc-section\" id=\"Not_a_place_to_hide\"><\/span>Not a place to hide<span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p>Granted, Cooperman\u2019s quip about using gold to hide one\u2019s net worth is metaphorical, a reference to the kinds of assets that can be less visible to the government\u2019s eye compared to those sitting in bank and brokerage accounts. As for the actual gold, the IRS treats precious metals as collectibles subject to long-term capital gains tax. Cryptocurrencies definitely do not belong in either of these categories, as they are neither collectibles (unless they are nonfungible tokens) nor less visible.<\/p>\n<p>If the goal is literally to conceal the wealth, resorting to a store of value that is automatically tracked on an open, immutable ledger doesn\u2019t sound like a good idea. Maria Stankevich, chief business development officer at cryptocurrency exchange EXMO UK, commented to Cointelegraph: \u201cToday massive BTC adoption is tightly connected not to the shadow money, but quite to the opposite \u2014 to its status of the transparent financial asset.\u201d Tim Byun, global government relations officer at crypto exchange OKCoin, added:<\/p>\n<blockquote><p>\u201cTaxing the ultra-wealthy has little or no impact on the surging adoption among all Americans and non-Americans into digital assets, specifically Bitcoin. [\u2026] It\u2019s foolish to think that they (as well as anyone) will look to Bitcoin as a way to &#8216;hide&#8217; their wealth given that bitcoin leaves a permanent digital footprint.\u201d<\/p><\/blockquote>\n<h2><span class=\"ez-toc-section\" id=\"Better_ways\"><\/span>Better ways<span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p>Douglas Borthwick, chief marketing officer at digital asset firm INX, said that viewing digital assets and Bitcoin (BTC) as a place to hide wealth is \u201crather off-base.\u201d While U.S. tax residents can still buy Bitcoin on offshore platforms without rigorous Know Your Customer and Anti-Money Laundering requirements in place, there are serious risks associated with delivery and custody. According to Borthwick, millionaires typically resort to other strategies:<\/p>\n<blockquote><p>\u201cThey invest in high-ticket items to guard against inflationary purchases. Think of Masters\u2019 paintings and parcels of real estate. There are many strategies that ultra-wealthy investors employ with their accountants to avoid more significant taxes. I\u2019m not sure that digital assets would lead the charge there.\u201d<\/p><\/blockquote>\n<p>OKCoin\u2019s Buyn opined that the ultra-rich will continue to preserve their wealth \u201cthrough tried and true means as they have access to the brightest lawyers, financial advisors and consultants.\u201d<\/p>\n<h2><span class=\"ez-toc-section\" id=\"An_indirect_effect\"><\/span>An indirect effect?<span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p>Even if digital assets are no good for concealing households\u2019 actual net worth, there could be other avenues for a hypothetical wealth tax to heighten millionaires\u2019 interest in crypto. Here\u2019s one.<\/p>\n<p>According to a January report by the tax policy nonprofit Tax Foundation, a wealth tax of 2% to 3% could <a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/taxfoundation.org\/wealth-tax\/\">erase<\/a> interest earnings on safer investments like bonds and bank deposits. This could become enough of an external shock to make wealthy investors reconsider their portfolios\u2019 structure and recalibrate them so as to give more weight to the more risky yet higher-yield assets.<\/p>\n<p>In other words, the hypothetical tax could embolden the rich to invest in cryptocurrencies and crypto derivatives to offset the stagnating gains from the more traditional assets. <\/p>\n<p><template data-name=\"subscription_form\" data-type=\"markets_outlook\"><\/template><\/div>\n<blockquote><p><strong><span style=\"color: #ff6600;\">If you liked the article, do not forget to share it with your friends. Follow us on\u00a0<span style=\"color: #ff0000;\"><a style=\"color: #ff0000;\" href=\"https:\/\/news.google.com\/publications\/CAAqBwgKMLG0nwswvr63Aw\" target=\"_blank\" rel=\"nofollow noopener noreferrer\">Google News<\/a><\/span>\u00a0too, click on the star and choose us from your favorites.<\/span><\/strong><\/p><\/blockquote>\n<blockquote>\n<p style=\"text-align: center;\">For forums sites go to <span style=\"color: #ff9900;\"><a style=\"color: #ff9900;\" href=\"https:\/\/forum.buradabiliyorum.com\/\" target=\"_blank\" rel=\"noopener\">Forum.BuradaBiliyorum.Com<\/a><\/span><\/strong>\n<\/p><\/blockquote>\n<blockquote>\n<p style=\"text-align: center;\"><strong>If you want to read more <a href=\"https:\/\/buradabiliyorum.com\/en\/category\/news\/\" data-internallinksmanager029f6b8e52c=\"2\" title=\"News\" target=\"_blank\" rel=\"noopener\">News<\/a> articles, you can visit our <span style=\"color: #ff9900;\"><a style=\"color: #ff9900;\" href=\"https:\/\/en.buradabiliyorum.com\/general\/\" target=\"_blank\" rel=\"noopener\">General category.<\/a><\/span><\/strong><\/p>\n<\/blockquote>\n<p><span style=\"color: black;\"><a style=\"color: #ff9900;\" href=\"https:\/\/cointelegraph.com\/news\/would-a-us-wealth-tax-push-millionaires-to-bitcoin-adoption\" target=\"_blank\" rel=\"noopener\">Source<\/a><\/span><\/p>\n","protected":false},"excerpt":{"rendered":"<p>&#8220;# Would a US wealth tax push millionaires to Bitcoin adoption? &#8221; Levying a progressive tax on the ultra-wealthy has been a talking point long popular with many United States Democrats, yet such a policy would have been unimaginable under a Republican administration and a split Congress. Now that the Democratic Party is back in&#8230;<\/p>\n","protected":false},"author":1,"featured_media":205498,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"fifu_image_url":"https:\/\/images.cointelegraph.com\/images\/1200_aHR0cHM6Ly9zMy5jb2ludGVsZWdyYXBoLmNvbS91cGxvYWRzLzIwMjEtMDMvYzhiNDFhZGUtYjdlNi00ZDZlLWFiMzUtNDk4ZmUxNmY0ZDRlLmpwZw==.jpg","fifu_image_alt":"","footnotes":""},"categories":[1],"tags":[74862,74355,117,73434,70934,46483],"class_list":["post-205497","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-general","tag-bitcoin","tag-adoption","tag-business","tag-irs","tag-regulation","tag-taxes"],"_links":{"self":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/posts\/205497","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/comments?post=205497"}],"version-history":[{"count":0,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/posts\/205497\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/media\/205498"}],"wp:attachment":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/media?parent=205497"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/categories?post=205497"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/tags?post=205497"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}