JoshChristmas is just around the corner, so be ready and set to celebrate yet another wonderful holiday. Shopping early helps avoid stress, allows you to plan your budget more effectively, and ensures access to a wider selection of gifts. If your friends and family are into cryptocurrency, why don’t you give them the best gift of all? There’s no need to scour through websites to find the perfect gift for everyone on your list. You can get cryptocurrency gift cards or buy Bitcoin and transfer coins to their wallets if they have one. Even the least technologically inclined have heard about Bitcoin, but opinions about investing in this asset class are varied. Therefore, you have a versatile gift.
Bitcoin Has Proven Itself as The Best Gift of The Christmas Season
Although countless cryptocurrencies have been created since Bitcoin’s debut, a large portion of them aren’t that significant. According to Statista, there are approximately 20,000 digital assets in existence, most of which are inactive or discontinued. When it was launched, Bitcoin was worthless, while today, it’s trading at $35,371.63, an impressive growth. Bitcoin is a durable store of value, having a limited supply of just 21 million coins, so it can’t experience inflation. You can buy less than a whole Bitcoin, as it’s divisible into smaller units called satoshis. Using a peer-to-peer service, you can buy Bitcoin directly from other users.
The time is ticking to buy Christmas gifts, but you still have some time before Santa Claus beats you to it. Chances are the people sitting around the Christmas tree know a little about cryptocurrency, so giving them a few satoshis will pay off in the long run in terms of adoption. Increased access to Bitcoin boosts adoption, creating a self-perpetuating cycle. Adoption means using Bitcoin for everyday transactions, investments, or remittances, meaning it’s not solely used by tech enthusiasts and those interested in decentralized currency. Bitcoin has witnessed considerable growth over the past decade.
There are seasonal patterns in Bitcoin price movements around the holidays, meaning it rises a little bit right before Christmas. Taking into account the historical trend and the bullish momentum noticed in November 2023, it’s safe to say Bitcoin is warming for a festive boost, meaning it has good long-term prospects. Still, the cryptocurrency market is notoriously volatile, so don’t get your hopes too high. Traditional financial markets are closed on December 25, which could allow the cryptocurrency to reach new heights. It’s recommended to be on the lookout for market updates and maintain a diversified portfolio.
Find Out How to Gift Bitcoin to Loved Ones and Friends
Bitcoin is a gift that can grow in value, not to mention that it increases familiarity with the usage of cryptocurrencies. Indeed, there’s been an influx of new, more affordable entrants lately, but whether they’ll gain the same level of popularity remains to be seen. There are several ways to gift Bitcoin, including:
Transfer Bitcoin to An Active Account
If the recipients live in a country where cryptocurrency exchanges are accepted, transferring Bitcoin via an exchange is the simplest method. All you have to do is to copy the giftee’s Bitcoin address to your clipboard and paste it in the send field of the platform you’re using. If you’re sending Bitcoin from a mobile app, use your phone’s camera to scan the QR code of the wallet address you want to send funds to. Giving or receiving Bitcoin doesn’t represent a taxable event, but the way the cryptocurrency is used may impact its tax liability in the future.
Print A Paper Wallet
A paper wallet is a straightforward way to give Bitcoin, but attention must be paid to the fact that it’s meant for one-time use, so you should resort to this method for smaller amounts of Bitcoin. Whatever you do, don’t let anyone see you create the paper wallet. It’s not something to attempt to do on a public computer. Use a printer that’s not connected to the Internet because hackers tend to exploit the vulnerabilities in wireless printers to steal sensitive data, so you’re at risk of your private key being hacked. Most paper wallet creators use a private key generator. Using the corresponding private key, the gift recipient can move the balance of the paper wallet to a software wallet.
Send A Bitcoin Gift Card
Some exchanges allow you to send Bitcoin gift cards from their platform or app, which holds a specific value of cryptocurrency. If you send Bitcoin to an active account and the gift is accepted, you can’t reverse the process; nevertheless, the recipient can send the Bitcoin back to you. To redeem the amount you deposited, the giftee must enter the code displayed on the card on the website. It can be used to add balance to their wallet, after which they can trade, send, or invest the cryptocurrency as they want. The best part is the Bitcoin gift card doesn’t have an expiration date (but its value may change with time).
Should You Report Your Bitcoin Gift on Your Tax Return?
As mentioned previously, giving and receiving Bitcoin isn’t subject to tax in most cases. Nonetheless, there are exceptions to every rule, and following this pattern guarantees you come to the right decision. If the fair market value of your gifts doesn’t exceed $16,000 a year, you have nothing to be worried about. Keep a crypto asset transaction record, which includes the date you give Bitcoin and its fair market value at the time to avoid unpleasant surprises. The gift recipients aren’t required to recognize their cryptocurrency as income, but they may be subject to capital gains or losses if attempting to dispose of the Bitcoin.
All in all, if you’re giving Bitcoin as a Christmas gift, take the time to write a letter to the gift recipients to help them locate much-needed information should they face a taxable event. Affirm your identity, describe the amount of Bitcoin included in the gift, and specify the date of acquisition and the fair market value of the cryptocurrency.