Do you want to send a loved one Bitcoin as a gift? If so, here’s what you should know before transferring your Bitcoin gift.
Receiving or giving Bitcoin as a gift was completely alien a few years ago. However, receiving or sending somebody Bitcoins as a gift is entirely normal. Although this digital currency’s price has reduced since last year, it remains something many people would love to receive as a gift.
Today, it’s easier for an ordinary investor to purchase Bitcoin via platforms like BitIQ or trade it. These digital platforms have made giving Bitcoin as a gift straightforward due to some of their functionality and features.
Ideally, you don’t have to struggle to get Bitcoin to gift a loved one. You register with the platform, purchase Bitcoin with fiat money, and then send them to your crypto wallet. After that, you can send them to your loved one’s digital wallet as a present. To make the process easier, consider the following when gifting someone Bitcoin.
Taxation
For a starter receiving Bitcoin as a gift, it’s crucial to understand that the taxman treats Bitcoin as a property. Thus, Bitcoin holders pay taxes like those with other assets like stocks and gold. Therefore, you might pay taxes this year on Bitcoin that you received last year as a gift if you sell them and make a profit. However, the taxman won’t tax you if you gift someone Bitcoin. The only exception when you pay tax is when your gift exceeds the $15,000 tax allowance.
Interest
Before purchasing Bitcoins and sending them to your loved ones, find out whether they are interested in cryptocurrencies. Essentially, you don’t want your Bitcoin to go to waste. Gifting a person Bitcoin is like purchasing them a lottery ticket. Whether the recipient is interested, the gift can be a significant success or nothing.
Not everybody would love to have Bitcoin in their investment portfolio. Some people do not see the value in holding or owning Bitcoin. However, the person you send Bitcoin as a gift could thank you in the future if its value increases significantly.
Volatility
Bitcoin is a high-risk digital asset. It’s also a high-reward investment when the recipient holds it safely in their crypto wallet. Essentially, your Bitcoin could realize significant value growth over the years. However, it could also lose value entirely, leaving only your gift recipient with experience. Therefore, ensure that the recipient understands the benefits and risks of owning or investing in this crypto asset.
Volatility could be a significant downside to giving somebody Bitcoin as a gift. However, it can also be an upside based on the recipient’s perception of Bitcoin. If you receive Bitcoin, its value can go through the roof or the floor. Some people believe that Bitcoin is the future of money, and it will eventually take over. If this happens, gifting somebody Bitcoin could be a game-changer in their life.
Knowledge
Bitcoin became popular after its dramatic price increase in 2021. However, many people still don’t know much about Bitcoin and other virtual currencies. So, if you decide to gift somebody Bitcoin, ensure that they understand what it is. For instance, ensure that your gift’s recipient knows how to access, store, and spend Bitcoins. You can explain to them or direct them to resources with relevant information about Bitcoin. Also, explain tax implications and the risks of owning this digital asset to the recipient.
Final Thoughts
Some people appreciate your Bitcoin gift, while others might not know about it. Therefore, find out what the recipient knows about Bitcoin before purchasing and sending your present. Your loved one might not even have a crypto wallet. Thus, you must do due diligence before sending somebody Bitcoin as a gift.
Receiving or giving Bitcoin as a gift was completely alien a few years ago. However, receiving or sending somebody Bitcoins as a gift is entirely normal. Although this digital currency’s price has reduced since last year, it remains something many people would love to receive as a gift.
Today, it’s easier for an ordinary investor to purchase Bitcoin via platforms like BitIQ or trade it. These digital platforms have made giving Bitcoin as a gift straightforward due to some of their functionality and features.
Ideally, you don’t have to struggle to get Bitcoin to gift a loved one. You register with the platform, purchase Bitcoin with fiat money, and then send them to your crypto wallet. After that, you can send them to your loved one’s digital wallet as a present. To make the process easier, consider the following when gifting someone Bitcoin.
Taxation
For a starter receiving Bitcoin as a gift, it’s crucial to understand that the taxman treats Bitcoin as a property. Thus, Bitcoin holders pay taxes like those with other assets like stocks and gold. Therefore, you might pay taxes this year on Bitcoin that you received last year as a gift if you sell them and make a profit. However, the taxman won’t tax you if you gift someone Bitcoin. The only exception when you pay tax is when your gift exceeds the $15,000 tax allowance.
Interest
Before purchasing Bitcoins and sending them to your loved ones, find out whether they are interested in cryptocurrencies. Essentially, you don’t want your Bitcoin to go to waste. Gifting a person Bitcoin is like purchasing them a lottery ticket. Whether the recipient is interested, the gift can be a significant success or nothing.
Not everybody would love to have Bitcoin in their investment portfolio. Some people do not see the value in holding or owning Bitcoin. However, the person you send Bitcoin as a gift could thank you in the future if its value increases significantly.
Volatility
Bitcoin is a high-risk digital asset. It’s also a high-reward investment when the recipient holds it safely in their crypto wallet. Essentially, your Bitcoin could realize significant value growth over the years. However, it could also lose value entirely, leaving only your gift recipient with experience. Therefore, ensure that the recipient understands the benefits and risks of owning or investing in this crypto asset.
Volatility could be a significant downside to giving somebody Bitcoin as a gift. However, it can also be an upside based on the recipient’s perception of Bitcoin. If you receive Bitcoin, its value can go through the roof or the floor. Some people believe that Bitcoin is the future of money, and it will eventually take over. If this happens, gifting somebody Bitcoin could be a game-changer in their life.
Knowledge
Bitcoin became popular after its dramatic price increase in 2021. However, many people still don’t know much about Bitcoin and other virtual currencies. So, if you decide to gift somebody Bitcoin, ensure that they understand what it is. For instance, ensure that your gift’s recipient knows how to access, store, and spend Bitcoins. You can explain to them or direct them to resources with relevant information about Bitcoin. Also, explain tax implications and the risks of owning this digital asset to the recipient.
Final Thoughts
Some people appreciate your Bitcoin gift, while others might not know about it. Therefore, find out what the recipient knows about Bitcoin before purchasing and sending your present. Your loved one might not even have a crypto wallet. Thus, you must do due diligence before sending somebody Bitcoin as a gift.
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