Investment: Bitcoin beats Apple

Investment: Bitcoin beats Apple

Opinions differ on Bitcoin. Crypto millionaires like Julian Hosp claim at every opportunity that anyone can get rich with cryptocurrency. Critical voices such as former Bundesbank President Jens Weidmann repeatedly warn: “Bitcoin is speculative, you can lose money with it.” In Germany, according to a representative survey by the digital association Bitkom, one in three residents aged 16 and over is thinking about investing in cryptocurrencies such as Bitcoin, despite all the imponderables. 3 percent of respondents say they have already bought crypto assets in the past, 6 percent intend to do so afterwards, and 23 percent do not want to rule it out. The fact that Bitcoin trading in this country is possible at all in a reasonably regulated environment is also thanks to the Federal Ministry of Finance. Ten years ago, the house of then-Finance Minister Wolfgang SchΓ€uble (CDU) recognized Bitcoin as “private money” and thus established a legal framework for the taxation of crypto profits. “Raw material and store of value” The fundamental decision was triggered by a parliamentary question from FDP member of the Bundestag Frank SchΓ€ffler. The graduate in business administration wanted to know how Bitcoin profits should be taxed according to the assessment of the federal government. The response from the Federal Ministry of Finance, which became known ten years ago (August 16, 2013) through an article in the Frankfurter Allgemeine Zeitung, was very fundamental. Frankfurt-based economist Philipp Sandner explains: “The ministry’s assessment was very fundamental for the handling of Bitcoin in Germany.” It has also held its own over the past ten years and has never had to be revised. “The decision made it clear very early on how Bitcoin is to be properly assessed, namely as a commodity and store of value, not as a currency or as a payment service or the like. The Federal Ministry of Finance did everything right at the time, and even at an early stage,” says Sandner. The tax consequences of the federal government’s response are still valid today. After a one-year holding period, speculative profits or income from sales of mined crypto assets such as Bitcoin are tax-free. The decision from the ministry’s response ten years ago is in line with the crypto custody rules that were enacted in Germany three and a half years ago and the so-called MiCA (Markets in Crypto Assets) regulation, which came into force at EU level at the beginning of July 2023. All of these regulations encourage long-term Bitcoin investments. “As a result, Germany has become quite a Bitcoin-friendly country, even if many people are not even aware of it,” says Sandner. Anyone who exchanged the sum of 2013 euros for Bitcoin in August 4000 and has held it since then can now exchange more than one million euros tax-free. But if you would have invested 4000,34 euros in Apple shares ten years ago, you could currently only look forward to a portfolio worth around 000, euros.

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