Bitfinex Requests Users To Submit Tax Records, But Why?

Bitfinex Requests Users To Submit Tax Records, But Why?
Advertisement

Bitfinex is widely regarded as one of the biggest cryptocurrency exchanges in the world but has irked some users with a shocking notice requesting that they share their tax records with the firm.
Perhaps, the most pricking development to users would be the heightened chance of the exchange sharing these records with the Government of the British Virgin Island and subsequently local tax authorities upon receiving it.
The statement read,

“Under the laws of the British Virgin Islands, we are required to submit certain information to the BVI government.
The government of the BVI may then exchange that information with the tax authorities in the customer’s country of residence.’’

While this move has been greeted with a lot of negative comments on social media, the company had already let users know about these requirements on their ‘terms of use’ page and would not be charged for complying to the government law. Is there a chance that users did not carefully go through the ‘terms of use’ while signing up on the platform?
Bitfinex would not be held responsible for a users ignorance in this case.
In fact, the notified users (mostly US residents) were mandated to complete and upload the requested documents before May 24, only seven days after the order was issued. Sanctions to be imposed by Bitfinex on defaulters had not been disclosed in the notice.
However, it is only a matter of time before users who do not wish to comply with the new request, move their digital assets away from Bitfinex and invariably lower trading volumes on the exchange.

Would this herald a beginning of crises for Bitfinex?

That is unlikely!
The firm is only fulfilling a mandatory government law guiding the BVI, the jurisdiction where it operates and individuals who do not evade taxes will comply over the next few days.

“Pursuant to BVI law, we are required to obtain self-certification from our customers in order to ascertain each customer’s tax residence” the notice read.

Bitfinex still offers the highest number of crypto tokens for trading by investors and had recently added Verge and Stellar to their platform.

What's Your Thought On This?, Let Us Know In the Comment Section Below.

Get Daily Crypto News On Facebook | Twitter | Telegram | Instagram