Democratic primary candidate Robert F. Kennedy Jr. has promised that he will eliminate taxes on Bitcoin and cryptocurrencies if he becomes the next US president.
He said this during a video conference address he gave at a Heal-the-Divide PAC event.
Specifically, he said that if elected, he intends to make conversions from Bitcoin to US dollars tax-free on any capital gains.
Summary
Taxes on Bitcoin in the US
In the US, as well as in many other nations, taxes are currently paid on any capital gains generated when selling Bitcoin or cryptocurrency.
In other words, when Bitcoin are sold, their purchase cost must be deducted upon collection, thus determining whether the sale was made at a profit or loss. If there is profit, the taxation should be at 20%.
This causes some BTC holders to prefer not to sell in dollars if they want to cash-out, because the cash-out in dollars can hardly be anonymous. In other words, sales of Bitcoin in dollars are easily detectable by possible audits by tax agencies, effectively making the payment of tax on any capital gains not avoidable.
In contrast, by selling into other crypto assets anonymously, any capital gains can be concealed. It is no coincidence that stablecoins have achieved such widespread success, although it is by no means easy to carry out these transactions in real anonymity. For instance, if they are done on exchanges that force users to verify their identity (KYC), they cannot really be concealed from the IRS.
Abolishing capital gains taxation could potentially open up the black, or at least obscure, cryptocurrency market and make it much more attractive.
Kennedy’s proposals
Robert F. Kennedy Jr. is a very strong supporter of Bitcoin, so much so that he has already spoken out on the subject many times.
During the same speech in which he promised to abolish taxes on Bitcoin, he also said he would partially collateralize the US dollar itself with BTC.
Indeed, he said that, if elected, he would like to initiate a gradual process that could start with covering 1% of Treasury bonds issued in hard currency such as gold, silver, platinum or Bitcoin.
The goal would be to help re-stabilize the US economy, as the initiative, according to Kennedy, would stimulate investment and incentivize businesses to grow their operations in the United States.
To be fair, both proposals do not seem particularly realistic, but there is nothing strange about that given that Kennedy is campaigning.
The electoral campaign
Robert F. Kennedy Jr. is a Democrat, as were his father Bob Kennedy and his uncle, namely former President John Fitzgerald Kennedy.
Current President Joe Biden is a Democrat, and a new presidential election will be held next year.
In theory, Biden should be the Democratic Party’s candidate, but he is losing support significantly. So it is possible that the party may opt for another candidate, although to date there does not seem to be any who can beat Biden in the primaries.
To be fair, Kennedy enjoys a good amount of support, higher than Biden’s, but not necessarily electorally. In fact, according to recent polls he would seem to lack the electoral strength to beat Biden in the primaries.
The point is that the majority of US voters do not seem to want Biden to run again, while the alternative Democratic candidate who to date seems to have the most electoral strength is current Vice President Kamala Harris.
As for the actual election, for now the polls give a neck-and-neck between Democrats and Republicans, so even if Kennedy manages to beat Biden and Harris in the primaries, it is by no means certain that he will become the next president.
In any case, the fact remains that Bitcoin and cryptocurrencies are topics of this election campaign.
