Ari10 Weekly Newsletter #138 (Crypto Business Insights, Crypto Market News and Ari10 Company Update)

GM! This is Mateusz Kara.

And you've just found the best place in the crypto space to know more about the blockchain industry.

I'm also giving you updates on my biz.

In Today's edition:

1/ The Fed Cuts Rates Again

2/ Bitcoin Debate in Germany

3/ Bitcoin in the European Parliament

4/ FTX's Repayment Plan

+ Crypto Business Insights & Ari10 Company Update

Sounds interesting? I think so.

Let's dive deeper into the crypto rabbit hole:

1/ The Fed Cuts Rates Again

The Federal Reserve met market expectations this time, cutting U.S. interest rates by another 25 basis points.

However, it’s worth noting that this comes amid a rise in inflation to 2.7% in November. This troubling signal suggests the central bank may pause its rate cuts in the coming months.

2/ Bitcoin Debate in Germany

Germany has witnessed the collapse of Olaf Scholz’s government, but during the final parliamentary debates, bitcoin became a topic of discussion.

Former Finance Minister Christian Lindner criticized the government, stating that failing to create a strategic bitcoin reserve this year was a mistake. He highlighted the sale of 50,000 BTC seized from a pirate movie site, which was sold at roughly half its current market value.

“We sold bitcoins worth billions for half their current value. This decision reflects a lack of vision,” said Lindner, directing his comments at the outgoing government.

Bitcoin’s emergence as a political topic in Germany could suggest it may become a point of discussion in the upcoming election campaigns.

3/ Bitcoin in the European Parliament

The bitcoin debate didn’t stop with Germany. French MEP Sarah Knafo, likely inspired by the Bundestag discussion, announced in the European Parliament her demand for the creation of a European Union bitcoin reserve. She also called for halting the issuance of the digital euro, a project currently under development by the European Central Bank (ECB).

4/ FTX's Repayment Plan

Finally, good news for former clients of the bankrupt FTX exchange. The company announced that the trustee-approved repayment plan will go into effect on January 3, 2025.

This means the exchange will begin repaying its creditors, bringing an end to the saga that began in late 2022.

Crypto Business Insights ??

Cryptocurrency Settlements in Poland: Documentation and Record-Keeping Obligations for Investors

Under Article 22(14) of the Personal Income Tax Act (u.p.d.o.f.), as amended effective January 1, 2019, deductible expenses related to the disposal of virtual currency include:

1. Documented expenses directly incurred for the acquisition of virtual currency.

2. Costs associated with the disposal of virtual currency, including documented expenditures paid to entities specified in Article 2(1)(12) of the Act on Counteracting Money Laundering and Terrorism Financing.

Per Article 22(15) u.p.d.o.f., such deductible expenses are accounted for in the tax year they were incurred, subject to the provisions of Article 22(16). Additionally, Article 22(16) u.p.d.o.f. states that any excess of such expenses over income derived from the disposal of virtual currency in a given tax year can be carried forward to increase deductible expenses in the subsequent tax year.

Key Clarifications from Legislative Explanations

The rationale behind amendments to tax laws (Sejm Document No. 2860, dated September 25, 2018) clarifies that:

• Deductible expenses are limited to documented costs directly related to the purchase and sale of virtual currencies incurred during a given tax year.
• Expenses unrelated to these activities, such as financing costs (e.g., loans, credit), are not deductible.

Moreover, similar principles apply under Article 7b(1)(6)(f) of the Corporate Income Tax Act (CIT), which treats revenues from the exchange of virtual currencies as capital gains. The relevant expenses that may be deducted, per Article 15(11) of the CIT Act, must also be directly tied to the acquisition and exchange of virtual currencies. This excludes indirect costs, such as:

• Costs of financing the purchase (loans, credit).
• Equipment purchases (e.g., computers, cryptocurrency mining rigs).
• Electricity costs.
• Depreciation of computer equipment.

Notably, some tax authorities may have differing views on whether certain expenses qualify as direct or indirect.

Importance of Documentation

Proper documentation of expenses is essential. Tax regulations do not explicitly specify how expenses should be documented, but general principles under Article 22(1) u.p.d.o.f. apply. Courts have consistently ruled that expenditures may be proven by any admissible evidence, as indicated in multiple judgments, including:

1. Judgment of the Supreme Administrative Court (NSA), dated May 31, 2016, Case No. II FSK 198/16: Documentation is not restricted to specific types of evidence and may include any means that substantiate the expense.
2. Judgment of the NSA, dated October 18, 2017, Case No. II FSK 2417/15: The obligation to document expenses is procedural rather than normative, emphasizing the ability to prove incurred expenses through valid means.
3. Judgment of the NSA, dated April 26, 2012, Case No. II FSK 91/11: Even if formal documentation is missing, expenses may be substantiated by other reliable evidence indicating actual expenditure.
4. Judgment of the Voivodeship Administrative Court in Olsztyn, dated May 9, 2018, Case No. I SA/Ol 202/18: This ruling opposed an overly restrictive interpretation that would have resulted in taxation of gross revenue from cryptocurrency trading without allowing expense deductions.

Acceptable Forms of Documentation

Investors should collect the following types of documents to substantiate expenses related to cryptocurrency transactions:

• Invoices and receipts.
• Bank transfer confirmations.
• Civil law agreements.
• Exchange-generated reports.
• Screenshots of wallet transactions.
• Any other records that can provide details such as:
• Quantity of cryptocurrency.
• Purchase or sale price.

Practical Considerations for Cryptocurrency Transactions

Given the unique nature of cryptocurrency trading (e.g., transactions conducted via exchanges), alternative documentation such as transaction logs, spreadsheets, or screenshots may suffice. If these clearly show the transaction details, they may serve as valid evidence for tax purposes.

Taxpayers should retain all records that clearly identify transaction values, ensuring transparency and compliance with tax regulations.

ARI10 COMPANY UPDATE ??

In Employees Insights #10, we explore the essence of the partnership with Mennica Skarbowa S.A. ??

Mateusz Skiba, Franchise Director at Ari10 and a pivotal figure in the development of Cryptoterminal, highlights several key aspects of this collaboration:

? The Significance: This partnership showcases how traditional investment businesses and innovative crypto solutions can integrate seamlessly for mutual benefit.

? Benefits for the Partner: By providing comprehensive training for Treasury Mint's teams, we enhanced their knowledge and capabilities in the cryptocurrency space.

? The Value of Implementation: Given Treasury Mint’s strong reputation and market presence, this collaboration highlights the importance of building bridges between traditional finance and emerging technologies, overcoming long-standing differences.

As Mateusz aptly states, “I’m thrilled to see months of hard work translating into real results. Partnering with a market leader like Treasury Mint demonstrates that cryptocurrencies can have a meaningful role even in the most traditional investment sectors.”

While this is a significant milestone, it’s still the beginning…!

"Don't work for others, build your own." My dad taught me this without saying a word.

My story starts in an unusual place - my childhood home was literally inside an office building.

Every morning, I woke up to people typing on keyboards and talking business. The company employees became like extended family.

But watching my dad taught me the most valuable lesson.

He was in high management of a big company. Respected. Successful. Yet something was missing.

It wasn't his company. He was building someone else's dream.

That's when I learned: equity is king.

If you're going to pour your heart and soul into something, make sure you own it.

This shaped my entire approach to business. I decided early on that I wouldn't spend my life building other people's visions.

Today, I lead Ari10 Group, creating bridges between traditional finance and cryptocurrencies. It's not just a job - it's my company, my vision, my dream.

Sometimes the most powerful lessons come from what we observe, not what we're told.

Please rate this newsletter with a reaction:

?? - well done, Matt

???? - acceptable, it’s OK

?? - meh, do better…

Thanks for your feedback and see you next week!

Mateusz Kara