A Crypto-Tax Evader from Japan Faces Even Harsher Sentence in Second-Trial 0 865

A Japanese crypto-tax evader who had already been sentenced for failing to report his taxes is now facing even harsher punishment. According to reports, it was just the beginning of the month of March when the crypto-tax evader had been given his first punishment.

The first punishment consisted of him paying a fine and serving a year in the form of a suspended jail term. However, on March 30, 2021, the suspended jail term has been extended to 3 years instead of 1. Furthermore, the fresh order also suggests that the tax evader must pay around $163,000 as a fine for hiding his cryptocurrency assets from the authorities.

According to further details, the name of the tax evader is Hideji Matsuda, who is a 56-year-old white-collar company employee. In a high-profile case, Matsuda has had another 3 years suspended jail term added to his 1 year suspended jail term.

The order for serving the suspended jail term was passed by the Kanazawa District Court that is based in the Ishikawa Prefecture.

However, it was reported that Hideji Matsuda sought that he would be able to clear his name through the second trial. The local media sources have revealed that the second trial had reportedly been concluded on Tuesday, March 30, 2021.

The local media sources that confirmed the news are NHK, Chunichi as well as a tax law blogger from Japan who had all attended the second trial.

The tax law blogger revealed that the majority of the people that were in the court during the hearing were from Japanese media sources. The reason why the majority of the Japanese media is because the incident has caught the attention of the entire Japan.

As the country continues to make progress in the cryptocurrency sector, the locals are becoming more familiar with cryptocurrencies. The Japanese regulators have imposed taxes on cryptocurrencies starting at the beginning of the year 2021.

However, the Matsuda hearing is the first-ever trial for any person from the cryptocurrency industry facing charges for not being adherent with crypto-tax law and trying to evade taxes.

The Japanese court is now taking strict actions against the individuals or companies that are either failing to file their crypto-taxes or are providing sales information in their crypto-tax firms.

In the first trial, Matsuda had been accused of evading cryptocurrency taxes by showing very minimal earning for Bitcoin (BTC). According to the district court, he did this to evade the taxes that he was legally obligated to pay the Japanese authorities.

However, Matsuda’s lawyer tried to defend his client by claiming that Matsuda found the crypto-tax filing process to be complex. He claimed that the defendant was trying to figure out how he could calculate the figures for his taxes and by that time, the Japanese authorities took the action.

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IMF Says Russia and Iran May Use Crypto Mining for Monetizing Energy 0 42

The April 2022Global Financial Stability Report of the IMF has highlighted the consequences of the ongoing Russian invasion of Ukraine. The document said that the role of the US dollar was bound to be affected because of the conflict, as it would lead to the introduction of central bank digital currencies (CBDCs) and the global financial system’s resiliency would also be put to a test. The climate transition goals could also be put at risk because of the priorities associated with energy security. Another issue that would have to be dealt with in the coming years by lawmakers is the ‘cryptoization’ which is likely to occur because emerging markets are experiencing a widespread use of crypto.

IMF cited an increase in crypto trading volumes seen after the introduction of sanctions on Russia to back their statement. This included the financial penalties that had been imposed by Western nations on Russia because of its military invasion. The report said that such cross-border transactions were increasing in the long-term, which means that there would be challenges when it comes to imposing sanctions and managing capital flow. The IMF noted that crypto transactions have increased in both Russia and Ukraine because of the capital restrictions that have been imposed.

However, it is important to note that there has been a fall in liquidity in centralized exchanges where the hryvnia and ruble trading pairs are concerned. Therefore, using crypto exchanges for making large transfers has become rather impractical due to reduced liquidity. But, the IMF admitted that users do have the option of evading some measures via the crypto ecosystem because the identity verification requirements are quite lax in this industry. Hence, the international organization said that blocking new deposits of ruble and freezing crypto assets meant that users could have shifted to non-complying or less transparent crypto platforms and service providers.

Experts at IMF believe that both Russia and Iran could circumvent their respective sanctions via crypto mining. The nations could use their energy resources for generating revenue via crypto mining outside of the traditional financial system. Currently, the countries have a limited share of crypto mining activities, but there is a possibility that it could be increased, considering the size of the mining industry. The IMF quoted estimates showing that almost 11% of the mining revenues of bitcoin could have gone to Russia, which was around $1.4 billion per month, while Iran’s share had been 3%.

Bank of England Says Crypto Assets have Financial Stability Risks 0 81

On Thursday, the Financial Policy Committee of the Bank of England disclosed that they are working on developing a regulatory framework for digital assets. The central bank also made a reference to the sanctions that have been imposed because of the war between Russia and Ukraine in the statements. Bureaucrats and financial regulatory authorities all over the world have become increasingly concerned in recent times that Russia could take advantage of crypto assets to bypass the economic sanctions that have been imposed. The press statement of the BOE said that it was unlikely for crypto assets to provide Russia with a feasible way to get around sanctions at a large scale for now, but there was a possibility they could do so.

Therefore, it is a must to ensure that there are effective public policy frameworksthat can accompany innovation in crypto assets for maintaining the integrity and trust in the financial system. The crypto economy has been highly criticized by some members of the Bank of England for quite a while. Last year in mid-November, Andrew Bailey, the Governor of the Bank of England, had expressed his concerns about the adoption of bitcoin as legal tender in El Salvador. Sir Jon Cunliffe, the deputy governor for financial stability for the central bank, said in the following month that prices of crypto assets could drop to zero.

On Thursday, the report of the FPC talked about financial stability. The committee of the central bank noted that the FPC is assessing the risks to the financial system’s stability and it has concluded that these are currently limited. This is because their size remains limited for now and they are not that connected with the wider financial system. However, the FPC said that if they continue to grow at the same pace, and if they become interconnected with the overall financial system, then these crypto assets could pose a risk to the stability of the financial system.

Since the conflict between Russia and Ukraine began, politicians and lawmakers all over the globe have been discussing, developing, or even proposing laws aimed at regulating and researching digital currencies. The FPC’s statements on Thursday show that the BOE wants to classify crypto assets in the same category as it does traditional financial assets. Not only does the FPC plan on developing a regulatory framework that would govern digital assets, it has also mentioned stablecoins.

The FPC said that a major stablecoin that does not have a reliable deposit guarantee could turn out to be a risk to the UK’s financial system. According to the committee, if they introduce a systemic stablecoin, which is backed through a deposit mad with a commercial bank, it would result in significant risks to the stability of the financial system. All of this talk about crypto has been brought forward because of the Russian-Ukraine conflict and the possibility of the former using cryptocurrencies to evade the tough economic sanctions that have been imposed by Western nations due to its actions.

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