In the fast-paced world of digital assets, stablecoins stand out as a pivotal player, offering a bridge between traditional finance and the dynamic realm of digital assets. Despite recent challenges, such as those faced by the LUNA-backed TerraUSD, the appeal of stablecoins — especially those pegged to traditional assets like currencies, commodities and real-world assets — remains strong due to their high transactability.  

This article delves into the diverse applications of stablecoins, the current regulatory landscape in the United States and key tax considerations shaping this evolving ecosystem.

In light of Internal Revenue Service (IRS) Revenue Ruling 2023-14 (Ruling) that provides for the timing of income recognition upon receipt of staking rewards from a proof-of-stake (PoS) blockchain protocol, taxpayers should be aware of other considerations and scenarios that will require further analysis and professional guidance to determine taxable income from these activities.

We explore some of the many U.S. tax considerations around the formation and operations of decentralized autonomous organizations (DAOs) in the blockchain and digital assets spaces.

As a consequence of the ongoing 2020 recession sparked by the COVID-19 pandemic, borrowers are increasingly carrying underwater loans at historically high interest rates, worsening the financial burden many are already bearing. Many real estate investors are having conversations with lenders to discuss debt negotiations as a form of financial relief. Whatever the agreement they eventually come to, both parties should be aware that debt modifications can have consequences on their respective tax liabilities. This blog outlines the basic debt restructure model and the potential tax implications of debt modification for both the borrower and the lender.