Is it legal?
To the best of our knowledge, Cryptocurrencies have not been made illegal by legislation in most jurisdictions. However, some jurisdictions (such as Argentina and Russia) severely restrict or ban foreign currencies. Other jurisdictions (such as Thailand) may limit the licensing of certain entities such as Bitcoin exchanges where country like Japan accepted as legal tender.Major countries now are moving ahead with time and adopting cryptocurrencies as legal tender or regulated at least,as we see world showing extreme strong interest in crypto market makes no other choice but to accept and allow to be traded as parallel asset class.
Is it Regulated?
The protocol itself cannot be modified without the cooperation of nearly all its users, who choose what software they use. Attempting to assign special rights to a local authority in the rules of the global network is not a practical possibility. Any rich organization could choose to invest in mining hardware to control half of the computing power of the network and become able to block or reverse recent transactions. However, there is no guarantee that they could retain this power since this requires to invest as much than all other miners in the world.
It is however possible to regulate the use of Cryptocurrencies in a similar way to any other instrument. Just like the dollar, coins can be used for a wide variety of purposes, some of which can be considered legitimate or not as per each jurisdiction’s laws. In this regard, Crypto coins are no different than any other tool or resource and can be subjected to different regulations in each country. Crypto coins use could also be made difficult by restrictive regulations, in which case it is hard to determine what percentage of users would keep using the technology. A government that chooses to ban would prevent domestic businesses and markets from developing, shifting innovation to other countries. The challenge for regulators, as always, is to develop efficient solutions while not impairing the growth of new emerging markets and businesses.
What tax implication could be expected with profits?
Cryptocoins are not a fiat currency with legal tender status in major jurisdiction, but often tax liability accrues regardless of the medium used. There is a wide variety of legislation in many different jurisdictions which could cause income, sales, payroll, capital gains, or some other form of tax liability to arise.Please contact financial consultants or crypto experts to have a clarity over tax rates and treatment of income generated from cryptocurrencies in your juridiction.