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CoinSwitch Kuber becomes unicorn; Australians reminded over crypto tax

Coinswitch Kuber becomes unicorn meanwhile Australians reminded over crypto tax

CoinSwitch Kuber becomes India’s second crypto unicorn.

Australian Tax Office reminds crypto investors of obligations.

Korea’s finance minister says NFTs will not be taxed

We’ll have more on those stories — and other news shaping the cryptocurrency and blockchain world — in this episode of The Daily Forkast October 7.

Transcript

Another unicorn birthed in crypto.

Welcome to The Daily Forkast October 7, 2021. I'm Angie Lau, Editor-in-Chief of Forkast.News, covering all things blockchain.

Well, India has crowned its second crypto unicorn. That's after CoinSwitch Kuber's Series C funding round left the crypto exchange valued at US$1.9 billion.

We're going to take a look at the continuing rise in popularity of crypto trading in India and a whole lot more coming up.

Let's get you up to speed from Asia to the world.

First up, India's love of crypto shows no sign of stopping despite continuing uncertainty over government regulation.

New investors getting on board in CoinSwitch Kuber's US$260 million funding round include Silicon Valley's a16z and Coinbase Ventures. Existing investors include Sequoia, Paradigm, Ribbit and Tiger Global, they also participated in the round.

So if you're wondering, companies name origin here - choosing to name themselves after the Hindu God of wealth, Kuber, never seemed more appropriate.

Forkast.News Monika Ghosh has more from India.

CoinSwitch Kuber has come a long way since it set up in Bengaluru, India, in 2017, with the aim of simplifying access to cryptocurrencies, at a time when most Indians, including the government and central bank, were suspicious of them.

Its US$1.9 billion valuation means it is now ahead of India's first crypto unicorn CoinDCX, which is valued at US$1.1 billion.

This is CoinSwitch's third fundraising round this year, with its total funding now standing at over US$300 million, and its valuation has grown nearly four times in just six months.

Just last month, it said it was the largest Indian exchange in terms of user numbers, with over 10 million customers. That's a massive leap from the one million it had in November 2020.

One expert told Forkast.News while 10 million is only a fraction of the population, it's huge, given only 15 million people in India have to pay taxes.

"People who invest in crypto and the people who pay tax because of gains from the stocks and mutual fund investments are roughly the same size. That's a huge deal for crypto to have achieved in just a few years, and it would only grow from here."

The newly crowned unicorn says it plans to use the funds to increase its user base to 50 million. Launch new services like lending and staking, and offer a product geared towards institutional clients.

For Forkast.News, I'm Monika Ghosh, Pune, India.

Meanwhile, Australian crypto investors have been reminded the taxman cometh, even for you.

In response to questions to an Australian Senate inquiry on fintech, the country's tax office said that crypto transactions are to be treated in the same way as share trading when it comes to taxation. But authorities are concerned that many would-be crypto taxpayers are actually not aware of that.

The ATO says it's now seeking to educate investors it believes are misreporting due to a lack of understanding, rather than deliberate non-compliance. They're going to give you the benefit of the doubt for now.

Forkast.News Lachlan Keller reports from Melbourne, Australia.

Under the ATO's guidance, private taxpayers are subject to the capital gains tax regime any time they sell, swap or exchange cryptocurrency with the net capital gain or loss to be reported on their income tax return.

This letters advice forms part of a campaign by the ATO to better educate people and their crypto tax obligations, and it follows reminder letters sent to 400,000 Australians at the end of the tax year in 2020. However, given the level of interest in the market, many more investors are likely to have jumped into the crypto scene since.

Indeed, one newcomer investor told us he was completely unaware of these obligations before we asked them to speak on them.

But Kraken Digital Asset Exchange told Forkast.News they do their best to make their clients aware of the obligations and believe other exchanges behave similarly.

"We urge all of our users and any other other crypto aficionados in the space to to speak to their qualified accountants when it comes to understanding tax obligations better. But the important thing is to keep records and keeping good records makes the job very easy."

Michael Bacina of Piper Alderman, told us the ATO has broad data gathering powers and that anyone trading with the digital currency exchange in the country should assume the agency has access to those trading records.

Bacina suggests people should also be aware of how NFTs may interact with their self-managed superannuation, or retirement, funds, saying some funds prohibit investment at art, which some NFTs could be considered.

For Forkast.News, I'm Lachlan Keller from Melbourne, Australia.

And finally, today, let's just stick with the taxman here, because Korea says it will not tax NFTs. Why? Well, that's a good question, and one the country's finance minister initially stumbled over answering.

At the National Assembly's annual review on Wednesday, Hong Nam Ki was asked about the amended income tax law, which includes taxing crypto income from January 1st of next year.

When asked if that tax is ready to be applied next year, he said absolutely yes.

But when asked about taxing NFTs, the minister was not so certain, initially saying there's still some controversy over whether NFTs count as virtual assets.

However, he later rehashed that answer, saying that - well, right now NFTs are not virtual assets, at least not considered virtual assets in Korea.

Thus, they will not be taxed just yet.

The minister also got grilled on the original tax code proposal. Why tax Crypto while there is still lack of clarity over categorization of assets? Well, the minister insisted that the basic infrastructure for taxing crypto is ready as the latest crypto regulations have allowed the authorities to specify transactions.

So, as they say, in this world, nothing is certain but death and taxes, and that includes crypto.

And that's The Daily Forkast from our vantage point right here in Asia. For more visit Forkast.News.

Subscribe, hit like, you know we appreciate you. I'm Forkast Editor-in-Chief Angie Lau. Until the next time.

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