Tag Archives: CryptoSydney

Changes coming for cryptocurrency and digital assets

Cryptocurrency and digital assets are regarded by many as the next big thing. No wonder then that participation in the crypto/digital assets market jumped by a staggering 63% from the 2020 to the 2021 financial year. This is partly due to ease of access which has been facilitated by multiple asset exchanges making their platforms readily available in Australia. With this increase in participation also comes increasing scrutiny from the government, with the release of terms of reference for various reviews into regulation and taxation of digital assets.

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SMSFs investing in crypto-assets

According to ASIC, there has been surge of promoters encouraging individuals to set up SMSFs in order to invest in crypto-assets. It warns that crypto-assets are high risk and speculative, as well as being an attractive target for scammers. While SMSFs are not prohibited from investing in crypto-assets, individuals thinking of setting up an SMSF are encouraged to be informed around the decision. Remember, trustees bear all the responsibility for the decisions of the SMSF complying with the law, and breaches may lead to administrative or civil and criminal penalties.

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Are cryptocurrency losses from scams deductible?

As investing in cryptocurrency becomes more popular in Australia, there is also a corresponding increase in the amount of scams being reported. Due to the unregulated nature of cryptocurrency and the recent failure of two Australian cryptocurrency exchanges, this investment space has become a risky free-for-all, with Scamwatch estimating that around $35m were lost to cryptocurrency scams in the first half of 2021. If you’re one of the unlucky ones to have been scammed, depending on your circumstances, a capital loss may be claimed.

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