Cryptocurrencies have become a valuable tool and a potential investment for digital enthusiasts and entrepreneurs alike. One of the growing trends at American and Indian weddings is to gift couples with Bitcoin. Here are facts you need to know about cryptocurrency payments and donations.
Why Gift Cryptocurrencies?
Since the advent of Bitcoin, cryptocurrencies have become progressively accepted as a mode of payment. As a digital ledger, it facilitates speedy, secure, and transparent commerce. Its reliability has prompted organizations to explore its value for various applications.
Additionally, more eCommerce businesses are accepting cryptocurrencies like Bitcoin. According to recent statistics, global cryptocurrency values had risen by 900% between March 2020 and February 2021. The report also indicates the volume of transactions went up by 78% from the previous year.
How to Give Cryptocurrency as a Gift
You can offer cryptocurrency as a wedding gift by sending Bitcoins conveniently to the recipient’s wallet. You’ll need to set up an account on an exchange platform. Once you have the recipient’s address, the process is as easy as sending an email.
Also, many online platforms accept Bitcoin payments. They range from coffee shops to luxury wedding venues. The recipient of the gift can use digital currency to buy goods online.
Make sure you keep your account credentials safe once you open an account. You’ll need the information to use your wallet. Otherwise, you could lose access and risk losing the Bitcoins in your account.
Gift Cards and Commemorative Coins
You can also buy gift cards with Bitcoins to send as a wedding present. Find a reputable platform that sells cryptocurrency gift cards. The recipient can redeem the card on the same platform.
Buying novelty coinage is another way to present a cryptocurrency gift. A physical coin can serve as a collectible item. If your friend is a Bitcoin enthusiast, a novelty currency will make for a pleasant surprise.
How Are Cryptocurrency Gifts Taxed?
Typically, gifting your friend cryptocurrencies will not incur taxes. But if selling a currency generates a profit, a capital gain tax will apply. You will only have to inform the internal Revenue Authority after the sale.
If the sale was within a year of receiving the gift, it is taxed as ordinary income. A profit made after that duration is a long-term capital gain, which has a lower tax rate.
Is It a Good Idea to Give Bitcoin as a Wedding Gift?
The volatile nature of Bitcoin is one factor you ought to consider before purchasing the gift. It is common for its value to fluctuate in either direction. According to Sofi Invest, the price of Bitcoin went “down by approximately 23%” to$46,000 in August 2021. That is a drop from its all-time high earlier in the year of $60,000.
You also have to consider the gift from the recipient’s perspective. If your loved one is not conversant with Bitcoin, using the currency could be a frustrating experience.
As with any other gift, take time to learn the recipient’s interests. Always keep your login information secure while you explore ideas on different platforms.