Pray tell, dear reader, have you heard the latest tidings from the esteemed US Internal Revenue Service (IRS), that formidable arbiter of fiscal propriety? In a move as unexpected as a proposal from a gentleman of questionable character, the IRS has deigned to update its guidance for cryptocurrency exchange-traded products (ETPs). Lo and behold, a safe harbor has been extended to trusts, allowing them to stake their digital assets with all the fervor of a society matron at a card party. 🃏
Treasury Secretary Scott Bessent, in a missive posted on the ever-chattering platform X, proclaimed that the agencies have provided crypto ETPs with “a clear path to stake digital assets and share staking rewards with their retail investors.” One can only imagine the flutter this has caused among the investment set, as they scramble to secure their place at this new table of fortune. 💼
According to the guidance, which one may peruse on the IRS’s digital repository, crypto trusts are granted the privilege of staking, provided they adhere to certain conditions. These include being traded on a national securities exchange, holding only cash and “units of a single type of digital asset,” and ensuring said assets are held by a custodian. One must also mitigate specific risks to investors, lest the whole endeavor collapse like a poorly constructed soufflé. 🍰
“The impact on staking adoption should be significant,” declared Bill Hughes, senior counsel at Consensys, in his own X post. With the air of a man who has just secured the best seat at the ball, he added, “This safe harbor provides long-awaited regulatory and tax clarity for institutional vehicles such as crypto ETFs and trusts, enabling them to participate in staking while remaining compliant.” One can almost hear the collective sigh of relief from fund sponsors, custodians, and asset managers, who have long been deterred by the specter of legal uncertainty. ⚖️
This guidance arrives on the heels of the US Securities and Exchange Commission (SEC) approving generic listing standards in September, a move expected to pave the way for crypto exchange-traded funds. The IRS and Treasury, ever mindful of their colleagues’ endeavors, noted the SEC’s rule change as part of their updated guidance. How very obliging of them! 📜
Guidance on the Eve of Government Resumption? How Convenient!
After more than 40 days of what can only be described as a farcical government shutdown, reports emerged on Sunday that several Democratic lawmakers in the US Senate have broken ranks. In a twist as dramatic as any novel, they are now willing to join Republicans in passing a continuing resolution through January, thereby ending the shutdown. One wonders if the timing of this crypto guidance is mere coincidence or a calculated maneuver to distract from the political theatrics. 🎭
At the time of publication, the Senate had yet to vote on the measure. Since the shutdown commenced on October 1st, staff at various departments and agencies, including the SEC and IRS, have been furloughed. One can only hope they have found more amusing ways to occupy their time than the usual drudgery of bureaucracy. 🕊️
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2025-11-11 01:14