How to buy and sell cryptocurrencies in the US
What are cryptocurrencies?
Cryptocurrencies are digital tokens that can be used to buy or sell goods and services online.
They’re similar to the way Amazon, eBay and other online retailers use cash.
But unlike cash, cryptocurrencies are traded in a peer-to-peer network, or P2P network, rather than a centralised exchange.
There are different types of cryptocurrencies: Bitcoin, Ethereum, Litecoin and others are popular.
But a group of US states is seeking to make them illegal.
The legislation has been approved by the state’s legislature and is now awaiting the governor’s signature.
The bill will be introduced to the full state legislature on April 1.
What is legal?
In the US, there are two types of digital currencies: cryptocurrencies and other digital assets.
Cryptocurrency coins are bought and sold through an exchange, where they can be converted into cash.
Other digital assets are used to pay for goods and are traded on exchanges.
For example, a Bitcoin can be bought with a US dollar and exchanged for a cryptocurrency like Ethereum, then sold on an exchange for a different cryptocurrency like Bitcoin Cash.
The government is concerned that cryptocurrencies could be used by criminals and other nefarious actors.
What are the consequences of the bill?
If passed, the new law will make it a crime to buy cryptocurrencies without a “valid government-issued or licensed” ID card.
If a person is convicted of a crime, they will face a maximum of five years in prison and a $250,000 fine.
If the buyer is a US citizen or permanent resident, they can apply for a temporary restraining order against the seller to prevent them from selling their cryptocurrency.
How can I get my hands on my cryptocurrency?
It’s a good idea to use a third party to buy your cryptocurrency, such as Coinbase, which was acquired by PayPal for $1.6 billion in 2017.
If you don’t have a bank account, a wallet or other safe-deposit box to store your cryptocurrency in, there’s a virtual currency called Ether.
You can get it for about $50 at Coinbase.
Alternatively, you can use a wallet service such as Ledger or Coinapult, which will send you a QR code that you scan to get a virtual card to use in your wallet.
The blockchain is a collection of digital data that records transactions.
It is stored in a decentralized network of computers called the blockchain, which is made up of millions of computers across the world.
You’ll need a bitcoin to get started.
The US government says the cryptocurrency is not subject to regulation under existing federal laws.
Is there a legal option for buying cryptocurrencies?
No, it’s illegal to buy, sell or possess cryptocurrency.
If there’s no regulation, there is no legal way to do so.
However, the government is planning to change that later.
If it does, you could be liable for crimes if you fail to act in a way that is consistent with the law.
This could include using cryptocurrency without a valid government- issued or licensed ID card, buying or selling cryptocurrencies without permission or registering an address with the government.
Where can I find more information about cryptocurrencies?
Read more about cryptocurrencies on our About page.
What happens if I’m arrested?
You can still be arrested if you’re convicted of any crime related to cryptocurrency and you’re found guilty of a serious crime, such to trafficking in counterfeit goods.
This can result in prison terms of up to 10 years.
If I have a criminal record, what happens to my assets?
Your assets may be seized.
However the law doesn’t say where they go, so you’ll have to check with your lawyer to see if your assets are protected by the asset forfeiture process.
If your assets have been seized, they’re not protected by federal law and cannot be transferred or sold.
What if I lose my cryptocurrency or other digital asset?
If you lose your cryptocurrency or digital asset, it will be destroyed and no one else can claim it.
However if you receive a court order or have a lawsuit filed against you by another party, you may be able to get your digital asset back.
Read more on how to get back your cryptocurrency.