What is the quantity of cryptocurrency?

What is a cryptocurrency?

A cryptocurrency is virtual money , so unlike conventional money, this type of currency, being digital, only exists on the web, and is outside the control and regulation:

In any case, cryptocurrencies allow us to operate in the market carrying out transactions like any other currency , as long as the parties accept the use of it, instead of traditional money. Thus, today it is possible to pay for the purchase of a product with a cryptocurrency, as long as the seller accepts this form of payment.

In this way, to buy or sell with cryptocurrencies, we will only need Internet access and know our password and that of the person with whom the operation is going to be carried out, and all this is possible thanks to block chain technology .

What are the benefits of cryptocurrencies?

Among the advantages of using cryptocurrencies, we can highlight the following:

Build a token bridge It allows us to carry out faster and more effective transactions than transactions with traditional money, since payments are made instantly, are simple to make and can be made anywhere in the world.

In addition, virtual currency transactions are completely secure and private, which does not mean that they are anonymous.

What risks do cryptocurrencies carry?

The risks presented by cryptocurrencies are several, and this is the reason why the National Securities Market Commission (CNMV) has recommended retail investors not to buy bitcoins -which is the most popular cryptocurrency.-

That said, we must know that the digital currency market is completely unregulated , and they are not under the control of any particular government or bank.

In addition, the owner of cryptocurrencies is not protected by the Deposit Guarantee Fund of credit institutions, which is the case with deposits in traditional money up to the limit of 100,000 euros per bank account.

On the other hand, the cryptocurrency market is very volatile , since the price depends solely on the law of supply and demand, which implies that the value of a cryptocurrency can have strong rises or falls in price.

At the time, there are already countries that have banned its use , such as Bangladesh or Bolivia.

Major cryptocurrencies

Without a doubt, Bitcoin is the most popular cryptocurrency, however, since its appearance, more than 1,000 have appeared, the most popular being Ethereum, Bitcoin cash, Lite coin, or Ripple, among others.

How are cryptocurrencies declared in treasury?

We must know that the gains or losses that we have from the sale of virtual currencies must be declared in the IRPF .

In this way, the value to be declared of the capital gain or loss will be determined by the difference between the transmission and acquisition value.

However, if a person makes the order to sell cryptocurrencies in one year, but the money in his checking account is received the following year, the following question may arise: in what financial year should such a declaration be made?

And to answer the previous question, the General Directorate of Taxes has ruled on it in a binding consultation dated March 22, 2018, establishing that said gain or loss will be attributed to the tax period in which the asset alteration takes place.

So now we ask ourselves , when is it considered that this patrimonial alteration occurs?

Well, the alteration in the taxpayer's assets derived from a sales contract will occur at the time the transfer takes place through the delivery of the property or right sold.

Given this, suppose that a person makes a sale of cryptocurrencies on December 15, 2017, and the price of the sale is entered into the seller's account in January 2018. Based on this, said operation must be included in the income presented by the financial year 2017.

What happens then with cryptocurrency losses?

Cross chain bridge development Well, these will be imputed with the limits of integration and compensation that correspond to the savings income, without operating any particular limitation for this type of goods.

Form 720 for the declaration of cryptocurrencies

Form 720 is required to be filed by those taxpayers resident in Spain who have assets and rights located abroad that exceed €50,000.00 as of December 31 in any of the following types of assets:

Accounts in financial institutions located abroad

Previously, taxpayers who had investments in cryptocurrencies did not have to present said model. However, on May 25, 2021, the Congress of Deputies approved the Law on Measures and Prevention against Tax Fraud, which is already in the Senate to complete its parliamentary process.