Category: Cryptocurrency

Smog, the latest sensation in the world of meme coins on the Solana blockchain, offers a fair launch model and lucrative airdrop incentives. This comprehensive guide combines detailed steps on purchasing Smog tokens with insights into its growth potential and community engagement strategies.

Understanding Smog Tokens

Smog ensures a fair launch without any presale, allowing everyone an equal shot at the beginning. Moreover, a significant chunk of Smog tokens is set aside for airdrops and community rewards.

The project strategically enters the market during the meme coin trend, benefiting from the efficiency of the Solana blockchain to attract a wide range of holders.

Smog aims to build a robust community base by focusing on airdrop campaigns rather than presales, which is essential for its long-term viability in the crypto market.

How to Buy Smog Tokens – A Step-by-Step Guide

Step 1: Setting Up Your Wallet:

To begin your journey of purchasing Smog tokens, you’ll need a digital wallet compatible with the Solana blockchain. Popular options include Phantom or Trust Wallet, offering user-friendly interfaces and seamless integration.

Step 2: Acquiring Cryptocurrency:

Acquire cryptocurrencies like ETH, SOL, USDT, USDC, or BONK from major exchanges such as Binance or Coinbase and transfer them to your Solana-compatible wallet.

Step 3: Choosing the Right Platform:

Multiple platforms are available for purchasing $SMOG, each with its own set of advantages:

– Deck Launchpad: Directly purchase Smog tokens using SOL tokens, with options to hold for instant access or stake for a 10% discount and airdrop eligibility.

– Jupiter (jup.ag): Swap other cryptocurrencies (SOL, ETH) for Smog tokens through its intuitive interface, enjoying lower transaction fees compared to Deck.

– Over-the-Counter (OTC): Obtain discounted entry to Smog tokens directly on the Smog website, accompanied by a 90-day staking requirement and airdrop eligibility. 

Step 4: Completing the Purchase:

Once you’ve selected your preferred platform and connected your wallet, proceed to exchange your chosen cryptocurrency for Smog tokens securely. The $SMOG token addresses for Solana and Ethereum are listed on the website for safe use.

Step 5: Participating in the Airdrop:

Maximise your engagement with the Smog community by signing up for the $SMOG airdrop on Zealy.io. Participate in various community tasks to earn additional rewards, such as extra XP from airdrops.

Smog Tokenomics

Smog has a strategic plan for distributing $SMOG tokens to achieve its goals within the Solana ecosystem. The total supply allocation supports the project’s growth, market liquidity and community engagement.

– Marketing Allocation: The largest portion, comprising 50% of the total token supply, is dedicated to marketing efforts.

– Airdrop Rewards: Another significant portion, totalling 35% of the token supply, is reserved for airdrop rewards. This approach incentivises community participation and aims to democratise access to $SMOG tokens, fostering a sense of ownership and loyalty among participants.

– Exchange Support and Liquidity Provision: To facilitate exchange support and ensure market liquidity, 10% of the token supply is allocated for Centralised Exchange (CEX) launches. Additionally, 5% of the supply is used for Decentralised Exchange (DEX) liquidity provision. These allocations enable $SMOG tokens to be easily traded across various platforms, enhancing accessibility and promoting price stability through robust liquidity support.

Roadmap

The Smog roadmap outlines a phased approach to the project’s development. Phase 1 focuses on foundational activities such as Airdrop Research, Staking Build, Social Activation and Token Deployment. This initial phase aims to set the groundwork for Smog’s presence in the crypto market.

Phase 2 signifies the execution of Smog’s strategic plans, including the Fair Launch, which underscores the project’s commitment to ensuring fair access for all participants. Additionally, the launch of the Airdrop Campaign and the objective to amass over 10,000 ‘loyal chosen’ holders indicate efforts to drive significant community growth and involvement. The platform also aims for social dominance and burn opportunities, demonstrating its dedication to enhancing visibility and managing token supply to maintain value.

Moving to Phase 3, Smog targets growth through the Airdrop Launch and Future Airdrops’ commencement to reward and continuously engage the community. The ambitious goal of surpassing 100,000 ‘Chosen Warriors’ suggests a significant expansion in token holders and market capitalisation. Furthermore, the pursuit of ‘Social Mastery’ and the aspiration to become the “Sol King of all meme coins” highlight Smog’s vision for achieving remarkable success and establishing dominance in the meme coin space.

Why Buy Smog?

Smog offers a rewarding airdrop strategy designed to incentivise early adoption and encourage active participation within the community. Through this approach, participants can earn rewards by engaging with the project, fostering a sense of ownership and loyalty among users.

The project upholds a fair launch model, ensuring all users have an equal opportunity to participate from the outset. This commitment to fairness enhances trust and legitimacy within the community, distinguishing Smog from projects that may favour certain users over others.

Benefiting from the expertise of an experienced team, Smog enjoys a level of credibility and reliability. Users have confidence in the project’s ability to execute its vision and deliver on its promises.

By leveraging the efficiency of the Solana blockchain, Smog offers investors fast transactions and low fees. This advantage appeals to those seeking opportunities in robust blockchain networks, providing a seamless and cost-effective experience for users.

Smog Price Prediction – What is $SMOG’s Potential?

– Potential Market Impact: If Smog reaches a $100 million market cap, it will likely make it onto centralised exchanges, potentially boosting its accessibility and liquidity.

-Price Dynamics: Currently sitting at $0.046, Smog has shown significant potential for growth, with a $63 million market cap. Early holders who purchased at 2 cents could already be up 200% – 300%, with the potential for a 28x return if Smog reaches a $1 billion market cap.

– OTC Benefits: Buying on OTC through the Smog website offers a 10% discount and a 42% APY, providing additional incentives.

– Engagement Opportunities: Engage in quests on Telegram or Zealy to gain an airdrop, with rewards increasing based on the amount of Smog tokens held. They also do limited-time only quests, such as on Valentine’s Day; it’s a form of gamification like quests in an RPG game.

Access the Smog community on X, Discord and Telegram to stay tuned with the latest project updates and news.

---

Disclaimer: This is a sponsored article, and views in it do not represent those of, nor should they be attributed to, ZyCrypto. Readers should conduct independent research before taking any actions related to the company, product, or crypto projects mentioned in this piece; nor can this article be regarded as investment advice.

February of 2024 is turning out to be one of the most exciting months for cryptocurrency markets in years. Bitcoin has entered a significant bull run, gaining over 20% in a matter of days. Of course, it automatically pulled many other altcoins along, including Solana, which reported gains of over 20% in the same period.

The crypto market rally is real, and despite smaller price corrections, the overall sentiment is bullish, and the markets will likely keep growing for months ahead. While Solana is gaining momentum, the newest Solana-based meme coin is showing 20x growth potential, so let’s see what’s going on from up close.

>>> Buy Best Coins Now<<<

Crypto Market Rally

SOL tokens surged by over 20% in the past week, followed by smaller price corrections a day after. The token is currently 15% up compared to the last week, and its price is $116. The sudden surge is in line with Bitcoin’s bull run, and many other tokens, including Avalanche’s AVAX, BNB coin, Cardano, and numerous others, saw growth of at least 3 to 5% during the same period.

Compared to the end of 2023, Solana gained over 500%, which is a significant price movement, and since it’s still in an uptrend, it’s expected to keep growing. It’s one of the rare cryptos that remained in an uptrend following the FTX scandal, primarily because of Solana’s unique DeFi protocols, making it an excellent platform for blockchain development.

Moreover, countless meme coins built on Solana went live in the past few months, and some saw 10x and even 50x gains in a short period. It offers impressive speeds, low transaction fees, and a unique proof-of-history consensus mechanism, making it one of the best options for gaming, DeFi, and NFT applications.

Despite being one of the best investment options on the market and showing clear signs of stable growth, SOL tokens can’t compare to a few emerging coins that will explode, resulting in 20x or higher gains in the next few months.

>>> Buy Smog Tokens Now<<<

Smog Token – Solana-Based Meme Coin to Rule Them All

The Smog Token is the latest crypto investment option showing clear signs of explosive growth, and it’s the next big Solana meme coin that will shake the markets in a way similar to Bonk, Myro, and Wif. It’s a token that launched directly to the Jupiter exchange without any presales, and it was more than welcomed by meme coin enthusiasts and traders worldwide.

Immediately upon launch, $SMOG tokens exploded, resulting in a 1000% rally within the first 24 hours. However, that was just the beginning, as the tokens gained another 500% the next day, reaching a market cap of over $80 million without breaking a sweat. 

Furthermore, Smog Token plans to launch the Greatest token Airdrop of all time, which will reward over 10,000 Loyal Chosen with free $SMOG tokens. Investors simply have to buy and hold on to their tokens to earn airdrop points and become eligible for the massive rewards that will follow.

That said, the initial airdrop will be only the first event, as the next airdrop will award 100,000 members of the Smog Token community who keep holding their tokens in the future. The approach is truly unique, and if the number of token holders increases by over 100K, the $SMOG token will easily blow all others out of the water.

>>> Buy Smog Tokens Now<<<

Can $SMOG Become the Next BONK?

Smog’s primary goal is to become the best Solana-based meme coin in 2024, following the path paved by Bonk, Dogwifhat, Myro, and other SOL-based memes. Its motto is “One meme coin to rule them all,” as it’s inspired by Smog the Dragon from the Lord of the Rings fantasy world.

20x growth is just the start, but with enough support, nothing will prevent $SMOG from reaching 100x gains in the next few months. According to a few popular crypto Youtubers, whales are now buying into the platform, signaling a period of explosive growth ahead.

>>> Buy Smog Tokens Now<<<

Smog Token Tokenomics

The distribution of $SMOG tokens has been thought out extremely carefully to ensure long-lasting growth. It has a total of 1.4 billion tokens, but 35% are reserved for the airdrop campaign, making it the number 1 Solana-based meme. 50% will be used to cover marketing costs, ensuring that the word about the next big meme reaches investors far and wide. The remaining 15% will be used for CEX and DEX liquidity pools.

Solana’s recent price movements helped Jupiter become one of the fastest-growing token exchanges, giving Uniswap a run for its money. $SMOG token’s launch on Jupiter was a massive success, and with all factors put together, it is already one of the top three most traded Solana-based meme coins on the market.

>>> Buy Smog Tokens Now<<<

Pandoshi (PAMBO) – Another High-Gain Meme Coin to Explode

Similarly to $SMOG, another new meme coin, PAMBO, has rocked the markets, reporting 500% gains during the presale. It’s attracting investors from far and wide and is becoming one of the most sought-after memes on the market. It’s based on complete decentralization, financial privacy, and community governance, all traits welcomed by the crypto community. 

The PAMBO presale raised over $5 million, and its unique design makes it a serious contender for the Smog Token. However, unlike $SMOG, PAMBO is an Ethereum-based meme that will probably have a hard time reaching 20x gains, but with enough support, anything is possible.

>>> Buy Best Coins Now<<<

Final Words

The crypto markets are in a bullish phase that will likely extend to the next few months. Many existing platforms are in an uptrend, focusing on Solana-based memes that made some of the most significant gains in the past few weeks. 

$SMOG tokens are the hottest investment option, and the platform’s promise of the Greatest Airdrop in History is something to be excited about moving forward. Therefore, invest in $SMOG today, become a Dragon Slayer, and hold on to your tokens to reap the benefits of the meme that will become the top Solana-based token in the next few months.

---

Disclaimer: This article is sponsored content and is not financial advice. CryptoNewsZ does not endorse or guarantee the accuracy of the content. Readers should verify information independently and exercise caution when dealing with any mentioned company. Investing in cryptocurrencies is risky, and seeking advice from a qualified professional is recommended.

Throughout history, there have various iterations of sound money, from the Rai stones of the Yap islands to the gold standard.

However, sound money has remained elusive over the last century following the proliferation of credit expansion through central banking fractional-reserve policies that lead to endemic inflation.

Sound money is consistently touted as a necessary prerequisite to a prosperous society and a stable price mechanism in free market economies by the Austrian School of economics.

Eminent figures such as FA Hayek, Ludwig von Mises, and Carl Menger detailed the root causes of ‘boom and bust’ economic cycles as the extended inflationary monetary policies that have come to dominate government direction since the 1930s.

FA Hayek even went so far as to presciently describe a new kind of currency that would be free from government control in 1984 as the only true means of achieving good, sound money again.

Since then, Bitcoin has emerged not only as sound money but perhaps exists among the hardest currencies created, made for the digital age.

Adequately understanding sound money is vital to comprehending the fundamental advantages of Bitcoin and why its novelty is often challenging to accept or comprehend after a prolonged period of global fiat dominance.

As a side note, if you have a chance to read The Bitcoin Standard by Saifedean Ammous, I would highly recommend it, no matter what your background is, as it provides some crucial context on sound money and Bitcoin’s place in monetary history.

Quick Summary: Bitcoin emerges as a decentralized, cryptographically-secured digital asset built for the internet age that meets the key criteria of sound money better than previous alternatives by retaining value over time, having a transparent and predictable supply resistant to inflation, and empowering users with financial privacy, inclusion, and sovereignty.

---

TLDR

Point	Explanation
Sound money emerges naturally	Historically, sound money like gold and silver emerged naturally in economies to facilitate trade and commerce.
Sound money retains value	Good money maintains its purchasing power over time. Easy money like fiat currency loses value through inflation.
Sound money has stock-to-flow	The existing supply compared to the flow of new production is high. This makes it resistant to inflation.
Sound money is hard to produce	The effort and energy required gives it inherent value. Simply printing money makes it unsound.
Sound money is divisible	It can be divided into small units without losing value, enabling convenience and micro-transactions.
Sound money preserves privacy	Decentralized cryptocurrencies like Bitcoin allow anonymous transactions, reducing coercive control.
Sound money enables sovereignty	Individuals retain control of their money and are not subject to decisions affecting its value made by others.
Bitcoin meets sound money criteria	Bitcoin has a fixed supply, stock-to-flow, decentralization, divisibility, privacy, and empowers users financially.

---

What Defines Sound Money?

The history of money is both enormously impactful on today’s conception of value and how sound money emerges naturally in a civilization. Examples of such sound money extend back to ancient societies, including the Yapese Rai stones and the gold Solidus of the Byzantine Empire.

Nick Szabo provides an excellent analysis of the ancient beginnings of value systems with his distinguished piece; Shelling Out: The Origins of Money.

Szabo details how money evolved from collectibles that were scarce and carried sentimental value or represented significant effort to acquire as some of the earliest origins of money.

Read: Crypto Profiles: Nick Szabo, The Quiet Cryptocurrency Pioneer

Money emerges to provide a solution to the Coincidence of Wants problem where an intermediary store of value that is salable across time and space is necessary to facilitate a growing economy.

Moreover, sound money needs to retain value over time, function as a medium of exchange, and be highly divisible to function at scale.

Ammous references that for money to be sound, it needs to be hard rather than easy. Easy money is what constitutes national fiat currencies today as their supply can easily be expanded, drastically reducing their value over time and making them a highly ineffective store of value.

The USD is ‘easy money’ because the Federal Reserve can expand the money supply through inflation as the government sees fit, to expand credit for public spending or bail out industries (i.e., global financial crisis of 2008).

Conversely, hard money — such as gold — has a high stock-to-flow ratio, meaning that the supply of the value in existence is significantly higher and consistently maintains a high ratio of how much is in circulation compared to how much can be injected into the circulation over any given period.

Gold achieves this not solely because it is rare, but because of the time and effort that is required to mine it is profound, making the introduction of more gold into the global gold supply relatively consistent and very low compared to the overall amount already available. As such, gold cannot be easily inflated and subsequently devalued.

Sound money is hard money that is highly divisible, salable across time and space, and leads to a low-time preference of participants in free market economies. A low time-preference leads to the accumulation of capital through savings and the eventual flourishing of production and technological advance.

Historically, gold is the most well-established sound money that has existed as a means of value in virtually every civilized economy since the Romans in one form or another.

The gold standard provides a stable price mechanism for international trade to function without the incessant need for competing devaluation of nationalized currencies that is so prevalent today (i.e., China and the U.S.).

Read: Crypto & Gold: Two Magic Bullets to Beat Recessions & the Fed says Ron Paul

Without sound money, people’s savings, consumer prices, and the overall economic direction of a country are at the whims of the entity that controls the money supply, which today, are ubiquitously governments.

An important caveat of central government banking that is widely overlooked or misunderstood is that central banks continue to hoard gold. If they believed in the value of their fiat currencies as sound money, there would be no need to hoard gold, yet they still do, which is extremely telling.

Gold is not a perfect means of sound money either, however. While it retains value over time and is widely acknowledged as the best store of value, it is not very divisible or convenient to transfer between parties, let alone for average people to hold it securely without custodial services.

Bitcoin emphatically represents sound money for the digital age, and while it is still very young, presents an undeniably fascinating case for a new form of value that is resistant to inflation, outside of the control of any single entity, highly divisible, and transferable to nearly anywhere on the globe, wifi connection or not.

---

How Bitcoin Is Sound Money

One of the best ways to view Bitcoin is as the first legitimate competition to central banking in the last century. Governments — and nobody for that matter — can control or destroy Bitcoin, introducing the notion of competition to an industry that has been dominated by Keynesian monetary policy for decades.

Bitcoin meets all of the prerequisites for sound money and is built for the digital age of the Internet, a vast improvement in transferability and personal sovereignty of value.

The amount of Bitcoin is capped at 21 million and is governed by an algorithm that cannot be fleetingly altered to inject more Bitcoin at a rate more than the elegant and predetermined value that is built into the protocol, which halves roughly every 4 years.

As such, Bitcoin’s stock-to-flow ratio gradually increases, meaning that its stock-to-flow ratio will eventually reach an immense level once the last bitcoins are issued through mining. That is the definition of hard money.

Read: What is Bitcoin, Ultimate Guide

Bitcoin is also decentralized, meaning that it is not subject to arbitrary policy decisions or needs of governments, third-parties, or malicious actors intent on destroying it as there is no single point of failure.

Further, Bitcoin is governed by a social consensus layer, where the users determine what Bitcoin is, and the protocol just enforces the abstractly agreed-upon rules of the community sentiment.

The incentive design of Bitcoin also leads to a self-sustaining economy of miners that adjust to Bitcoin’s difficulty algorithm, one of its most defining characteristics.

Bitcoin as a means of value exchange is unprecedented. There has never existed a mechanism for transferring sums of value — large or small — to other parties across the world with settlement in minutes.

Moreover, if you retain control of your private keys, the available funds are instantly yours, and there is no need to deal with trusted intermediaries, mitigating any capacity for censorship.

This is the primary advantage that Bitcoin holds over gold as it is divisible into a satoshi unit that can be transferred without custodial services at the discretion of the users through the disintermediation of trust.

Privacy also has profound implications for mitigating coercive control. The cypherpunks touted cryptography as the last legitimate means to preserve privacy in a digital age, and Bitcoin’s uncanny use of cryptographic primitives is a testament to the desire of many to transact privately and free from outside control.

---

Conclusion

While Bitcoin’s privacy is not perfect, it is constantly evolving, and the community has shown a strong preference to enhance its privacy-preserving properties continuously.

Perhaps most importantly, sound money provides the foundation for personal sovereignty that removes the need for reliance on policies that affect value outside the control of individuals.

Rather than relying on centrally directed and whimsical designs, users of Bitcoin retain what is theirs, and are free from the undue influence of others and subject only to the organic mechanics of a free market.

Sound money has evolved throughout history. To view government issued fiat as the final destination of what constitutes value is to ignore the dynamic nature of technology and the willingness of people to protect the fundamental principles that they strongly believe in.

Cryptocurrency represents an exciting new asset class – digital money powered by innovative blockchain technology. As cryptocurrencies like Bitcoin and Ethereum gain mainstream traction, more people are investing their hard-earned money into this digital gold rush.

However, where there’s money, there’s risk. Securing your cryptocurrency assets should be priority number one from day one. Unlike banks, crypto exchanges and networks offer no centralized protections or insurance coverage. And due to the irreversible nature of blockchain transactions, theft of your digital assets often means permanent loss.

So don’t wait until disaster strikes to take security seriously! This comprehensive advice from cryptohead.io will walk you through all the essential techniques for locking down your cryptocurrency investments against hackers and scammers. By being proactive and vigilant, you can navigate the crypto world confidently, without constant anxiety about breaches or fraud.

Now dive in!

Understanding the Threat Landscape

Hacking and theft pose the biggest menace to cryptocurrency owners. But the threat landscape stretches far beyond just malicious cybercriminals. You need to be aware of various potential weak spots in order to seal them up tight.

Hacking

Hackers have many clever techniques for sneaking into crypto exchange accounts, wallets, or gaining access to devices and private keys. Common hacking threats include exchange breaches, where flaws in exchange infrastructure can expose customer funds given the billions in crypto they manage, making exchanges prime targets.

Malware or keylogging is another threat vector, where nasty viruses can record passwords or alteration transactions on infected devices. Phishing sites and emails are also common, with fake login pages or messages tricking users into handing over wallet keys or account credentials. Finally, social engineering scams are on the rise, where attackers call, email or message posing as exchange or wallet support staff requesting sensitive account details from unsuspecting victims.

Physical Theft

Beyond remote digital threats, physical theft poses a legitimate risk to cryptocurrency owners. For example, if a hacker gets their hands on your smartphone or laptop, they may access wallet apps or decrypt locally stored files. Also, burglars who find your handwritten seed phrase from a cryptographic paper wallet can easily drain funds. Fires or floods also pose a major paper wallet risk.

Scams

From shady exchanges to fraudulent ICOs, the crypto industry unfortunately has its fair share of scammers running deceitful schemes. Be especially cautious of fake exchanges, which are bogus trading platforms designed to steal deposited funds or customer data. Carefully verify legitimacy before signing up.

During crypto bull markets, sketchy “blockchain startups” frequently run sham ICO offerings with unrealistic promises, simply taking investors’ capital and disappearing.

Pump and dump groups also regularly organize across social media, purposely hyping and manipulating certain cryptocurrencies to attract unsuspecting investors before crashing the price and disappearing with the profits.

Securing Your Cryptocurrency Accounts

Securing the online accounts which give access to your cryptocurrency should be priority number one. Apply these vital account security principles for protecting exchanges and software wallets:

Strong, Unique Passwords

Use different, randomly-generated 16+ character passwords for every exchange and wallet. Consider a password manager like LastPass or 1Password to create and store unique passwords safely.

Two-Factor Authentication (2FA)

Enable 2FA on all accounts for an extra login step with a time-based one-time passcode.

Identity Verification

Fully verify your identity on exchanges via KYC requirements to prevent fraud.

Multi-Signature Authentication

For advanced account security, use multi-signature authentication requiring multiple devices or accounts to jointly approve transactions.

Data Encryption

Check that exchange and wallet apps leverage end-to-end encryption and secure protocols like HTTPS to prevent MITM attacks.

Activity Alerts

Configure accounts to notify for withdrawals or login attempts via SMS, email or push notifications.

By incorporating consistent account security principles across every platform handling your cryptocurrency, you create crucial protective layers making hacks vastly more difficult.

Safe Storage for Your Cryptocurrency

While securing crypto accounts limits attack vectors substantially, savvy investors take things a step further using dedicated cryptocurrency wallets providing isolated, offline storage.

There are two primary classes of wallets:

Hot Wallets

Hot wallets stay connected to the internet, allowing convenient transfers but increased hacking risk. Leading software options include Metamask, Exodus and Coinbase Wallet.

Cold Wallets

Cold wallets keep private keys offline and physically disconnected, shielding them from online threats.

Recommended cold storage solutions include:

Hardware Wallets

Devices like the Ledger Nano X, Trezor Model T and KeepKey act like universal USB flash drives, providing a dedicated offline environment to store crypto investment safely away from main accounts.

Paper Wallets

Paper wallets involve printing out secret private keys and wallet address QR codes onto physical documents. You’ll want to create multiple copies across various locations in case of accidents.

By dividing funds between hot wallets for everyday usage and cold storage holdings for long-term, passive investing, you achieve the ideal account security balance.

Staying Vigilant Against Threats

Of course, no amount of security measures means you can just set and forget your cryptocurrency investment. Maintaining good practices around usage habits and software hygiene is vital for ongoing protection.

Keep apps, operating systems and browsers fully updated to receive the latest security patches through regular software updates. Watch for fraudulent emails, Slack/Discord DMs or texts directing to fake wallet sites attempting to steal credentials or keys to avoid phishing attempts. Never access crypto accounts on public WiFi networks. For secure public browsing use a VPN service like NordVPN or ExpressVPN to encrypt connections.

Carefully scrutinize any ICO offerings, airdrops or crypto projects before contributing funds to vet investment opportunities thoroughly.  You should also log into accounts frequently to check recent activity and confirm no unauthorized transactions as a standard monitoring best practice.

Advanced Protection Measures

Once core security principles are applied, more advanced users can optionally boost protection further through methods like:

Air-Gapped Machines

Dedicate an old laptop strictly for crypto, keeping it totally disconnected from all networks to create an isolated, impervious cold wallet.

Multi-Signature Transactions

Configure wallets supporting “multi-sig”, requiring multiple devices to jointly approve transactions for enhanced oversight.

Asset Sharding

Split overall portfolio across multiple hardware wallets stored in separate secure locations to mitigate physical loss risks.

Confidential Computing Platforms

Consider cutting-edge confidential computing services like Anjuna which run wallet apps in secure enclaves, hidden from potentially compromised operating systems.

Preparing for the Future

As cryptocurrency usage grows exponentially, next-generation security capabilities will become increasingly relevant:

Invest in quantum-secure blockchains and wallets utilizing quantum-resistant cryptography unbreakable even by advanced future computing technologies to prepare for quantum computing threats.

Adopt passwordless FIDO2/WebAuth login standards once supported to eliminate password hack risks entirely.

Incorporate on-chain auditing to monitor transactions, identify higher-risk counterparties and suspicious activity through blockchain analytics.

Demand platforms providing crypto services implement zero trust access models with continuous, contextual authentication.

Verify Transactions Carefully

One of the immutable principles of cryptocurrencies is the irreversibility of transactions. Once crypto is sent, it cannot be recovered or “charged back” like credit card purchases. This means verifying all transaction details before authorizing transfers is crucial.

Double and triple check the recipient’s address – one wrong character means lost crypto into the eternal blockchain void. Always copy-paste wallet addresses to eliminate any hand-typing mistakes. Confirm the currency type and amount repeatedly prior to final confirmation. For high-value transfers, confirm a small test transaction first.

By instilling diligent transaction validation habits, costly mistakes can be avoided.

Understand Account Recovery Mechanisms

Despite best digital security practices, it’s possible to lose access to exchange accounts and wallets by forgetting passwords or losing devices. Account recovery planning is essential.

For software wallets, the seed phrase backup during initial configuration represents the ultimate failsafe for restoring access. Treat seed phrases with utmost sensitivity, as anyone possessing them can assume custody of associated cryptocurrency accounts.

With exchanges, be sure to fully document and test account recovery procedures involving identity re-verification. Setup backup email, SMS and such during initial registration.

Without contingency mechanisms in place beforehand, locked-out accounts often mean inaccessible funds. Know your restore options!

Self-Audit Security Posture

As the adage goes, “You can’t secure what you can’t see.” Making security visibility core to your crypto ownership strategy is advised.

Establish a routine cadence for conducting personal security reviews across your entire range of cryptocurrency activities. Self-assess factors like wallet backups, software versions, recent unauthorized transaction attempts, remote login history and other critical indicators across accounts.

Keep an encrypted audit log capturing security state snapshots to identify gaps and trends. Leverage online scanning tools to automatically surface risks. Enlist a trusted friend to secondary check things.

Ongoing self-audits build essential security awareness, ensuring your evolving crypto setup remains robust.

Learn to Identify Red Flags

Vigilance against scams never stops, as hackers concoct evermore-devious schemes targeting cryptocurrency holders. Here are some common red flags:

Pressure to act quickly – scammers leverage false urgency to short-circuit critical thinking.

Promises of guaranteed massive returns – nothing eliminates crypto’s inherent volatility risk.

Spelling errors or shoddy graphic design – quality websites indicate quality organizations.

No address listing or official contact info – realize who stands behind opportunities.

Aggressive salespeople who call or message out of the blue.

By continually exposing yourself to known fraudulent tactics, your scam pattern recognition improves dramatically. Stay skeptical – if something seems off, trust instincts!

Wrapping Things Up

Hackers, scammers and thieves seek to ruthlessly separate innocent cryptocurrency investors from their digital assets. But through consistently applying core security practices, leveraging advanced protective measures and staying educated on emerging threats, you can invest, trade and transact with peace of mind.

Remember, vigilance is key! Establish rigorous routines around account security, be hyper-aware of phishing attempts, keep software updated and utilize cold storage. By internalizing comprehensive security guidance as habitual best practice, you can thrive in the cryptocurrency ecosystem while keeping valuable investments locked down tight.

The decentralized future promises greater financial access and independence. But first, security – protecting these new instruments of economic freedom is crucial to fully reaping the benefits without undue risk.

The Ethereum Virtual Machine (EVM) serves as the heart of the Ethereum blockchain, orchestrating the execution of smart contracts and fueling the decentralized landscape.

In this in-depth exploration, we delve into the technical intricacies, benefits, challenges, and prospects of EVM, offering critical insights for blockchain developers and enthusiasts alike.

What is EVM?

At its core, the Ethereum Virtual Machine is a virtual machine (a.k.a. cloud computer) that serves as a decentralized runtime environment designed to execute smart contracts. These self-executing contracts enable trustless and tamper-resistant transactions, laying the foundation for a revolutionary shift in decentralized application (DApp) development.

Besides the Ethereum blockchain network, several blockchains are EVM-compatible. This means they operate using the same standards and protocols as the Ethereum network. Examples include BNB Chain, Polygon, Avalanche, and Fantom, among others.

The Technical Makeup of EVM

EVM’s architecture consists of fundamental components like the stack, memory, storage, and execution environment. The stack manages data during execution, memory stores temporary variables, and storage stores persistent contract data. The execution environment ensures the seamless processing of transactions through a consensus mechanism, fostering a secure and efficient platform.

How EVM Works with Smart Contracts and DApps

EVM operates as the catalyst for processing smart contracts, enabling their execution on the Ethereum blockchain. Smart contracts, written in languages like Solidity, are self-executing and enforceable agreements, automating processes and transactions without intermediaries. Decentralized applications (DApps) leverage the decentralized nature of EVM, providing users with enhanced security and transparency.

Benefits and Limitations of Ethereum Virtual Machine

Using EVM comes with both advantages and disadvantages for developers and users alike.

Benefits

EVM’s advantages are multifaceted, encompassing transparency, security, and interoperability. Its open-source nature encourages collaborative development, fostering a vibrant ecosystem for blockchain projects.

Limitations

Despite its strengths, EVM faces challenges. For example, it grapples with scalability and performance issues due to gas limits. Scalability is influenced by state growth and full node requirements, impacting the overall performance of the system. Additionally, challenges in interoperability and upgradeability necessitate a focus on compatibility and streamlined processes to ensure smooth operations.

Deep Dive into EVM’s Operation and Functionality

Now, let’s look at how EVM works.

Important Functions and Features of EVM

EVM executes bytecode, a set of instructions generated by compiling smart contracts. This ensures consistency across all nodes in the Ethereum network, as each node independently processes and verifies transactions. Gas, a transaction fee, is used to allocate resources and prevent abuse, maintaining network integrity.

Understanding EVM’s Interaction with the Ethereum Network

EVM interacts with the Ethereum network through nodes, which validate transactions and contribute to its Proof of Stake consensus mechanism. Nodes execute smart contracts and store the entire transaction history, contributing to the decentralized and trustless nature of the blockchain.

Practical Use Cases and Implementations of EVM:

EVM finds diverse applications across various industries, showcasing its versatility and real-world impact. For example, decentralized Finance (DeFi) projects leverage EVM to power applications such as peer-to-peer lending and decentralized exchanges (DEXs).

The Future of Ethereum Virtual Machines

The landscape of blockchain technology is dynamic, and EVM adapts to emerging trends to enhance its capabilities. Layer 2 solutions, such as optimistic rollups and zk-rollups, aim to improve scalability by processing transactions off-chain and then submitting a single proof to the Ethereum mainnet.

Continuous improvements and community-driven developments shape the evolving landscape of EVM. Upgrades and optimizations, proposed through Ethereum Improvement Proposals (EIPs), demonstrate the commitment to enhancing the performance, security, and flexibility of EVM.

EVM’s Impact on Blockchain Development and Adoption

Blockchain developers can leverage EVM’s capabilities through strategic approaches. Optimizing smart contracts for gas efficiency, exploring layer 2 scaling solutions, and actively participating in the Ethereum community contribute to the successful integration of EVM into blockchain projects.

EVM’s user-friendly environment and robust features have significantly contributed to the widespread adoption of blockchain technology. As the go-to engine for decentralized applications, EVM plays a pivotal role in fostering the development of many popular crypto ecosystems.

Key Takeaways on Ethereum Virtual Machines

EVM stands as the linchpin of Ethereum, providing a secure and efficient platform for the execution of smart contracts and decentralized applications. Its fostering of trustless transactions and enhancing transparency underscores its importance in the blockchain realm.

As we navigate the dynamic landscape of blockchain technology, EVM remains a stalwart force, driving innovation and shaping the decentralized future.

Its significance extends beyond its technical prowess, encapsulating the ethos of trustless, transparent, and collaborative blockchain ecosystems.

HODL and Trade Crypto with Komodo Wallet (web)

Komodo Wallet is a non-custodial wallet, decentralized exchange, and crypto bridge that supports the Ethereum network and numerous other EVM-compatible blockchain networks.

Try Komodo Wallet today!

---

---

Whether you’re new or a seasoned DeFi user, chances are you have heard the term airdrops every now and then.

That’s because airdrops are a popular marketing strategy for DeFi protocols and crypto companies for several reasons:

1. It allows protocols to reward their community members for their activity and engagement in their respective platforms, thus further incentivizing users to stay in the protocol.
2. It helps projects drive awareness and new traffic to the brand and a product/service —especially if they’re releasing their native token.

As DeFi evolved through the years, so did the way protocols planned their airdrop campaigns. Crypto projects are constantly developing sophisticated airdrop strategies and better ways of delivering rewards, like gifting non-fungible tokens (NFTs) that grant users unique merchandise or access to exclusive content.

The following guide covers some of the hottest crypto airdrops for 2024 — potential, confirmed, and even recently distributed airdrops. You’ll soon notice that qualifying for them boils down to actively engaging with the protocols’ respective features, interacting with their testnets, creating new wallets, and referring friends to the protocol, among other activities.

Here are a couple of our guides on the topic that you might find interesting:

What Are Crypto Airdrops And How to Find the Next Major One?

Airdrops on Solana: The Most Popular Tokens Without a Token

Note that any airdrop or token launch, unless confirmed by the respective protocol, is speculative and not guaranteed.

Jupiter

Jupiter is a leading liquidity aggregator on the Solana blockchain, with over 1.2 million users actively swapping and trading assets on its platform. It handles between 60% and 70% of all the DEX volume on Solana.

Jupiter remained tokenless until the founding team unveiled their plan to launch the protocol’s native token, JUP, on January 31, accompanied by an official airdrop.

The airdrop itself was successful, and JUP is now one of the top 100 cryptocurrencies by market cap.

How did it work?

• Around 40% of the 10 billion JUP tokens are reserved for the community through airdrops.
• The tokens will distributed through four airdrop rounds, with the first happened January 31. Other dates will be disclosed.
• Half of the tokens will go to the community; 20% is vested for the Jupiter team.
• Token distribution is based on users’ past engagement with the platform, considering activities like trading volume on the site.
• The JUP token is designed to govern a future Jupiter DAO.
• Revenue sharing for the JUP token will only occur after Jupiter witnesses a tenfold increase in its user base, which is estimated to take two years.

This means you can still qualify for the future rounds airdrop. Here’s how:

1. Visit the Jupiter website and connect your Solana wallet.
2. Choose one of the many activities in Jupiter, such as Swaps.
3. You can also check out their Perpetual trading section or leverage their bridge feature to perform cross-chain operations.

Since Jupiter is native to Solana, if you want to check out other top Solana protocols that are yet to launch a token, check out our video:

LayerZero

LayerZero is an Ethereum-based interoperability protocol that connects multiple blockchains, allowing dApps to communicate with different networks through a single relayer. For example, Stargate, a liquidity transfer protocol, uses LayerZero’s messaging system to enable cross-chain transfers.

The team behind LayerZero confirmed the plans to launch the protocol’s own token in the first half of 2024, leading to speculation about a potential airdrop.

While specific details of the airdrop terms may still be pending, crypto users are convinced that the token’s release will come with an airdrop. Others speculate that the token, similar to previous projects in the Ethereum ecosystem, will grant users governance rights., giving them control over LayerZero’s future.

How to qualify:

• The idea here is to interact with protocols that have integrated LayerZero.
• Stargate, Curve, Shrapnel, and Pendle are some popular options.
• For example, you can stake STG tokens on Stargate, provide liquidity to receive a passive income, or become an active user in its DAO community.

Marginfi

Marginfi is a decentralized lending protocol without a token currently, but speculation suggests a potential token launch in the future. The protocol offers advanced risk management in lending services, benefiting both lenders and borrowers.

While Marginfi hasn’t revealed any plans to launch a token, airdrop hunters are convinced otherwise, mainly because the protocol employs a points system and is backed by numerous investors and VCs.

Lending, borrowing, and referrals are just some ways users can accumulate points, potentially leading to eligibility for an airdrop.

Steps by step, the process to qualify might look like this:

• Visit the Marginfi website and connect a Solana wallet
• Staking, swapping, and bridging assets will help you qualify.
• However, lending, borrowing, and referring are the best ways to earn “mrgn points.”
• Users with current deposits earn points (1 point per day per dollar lent). More lending and longer duration result in more points.
• Borrowers receive more points than lenders (4 points per day for $1 borrowed). Collateral for borrowing also counts for lending points.
• Referring users earn 10%, and this continues down the referral tree as more users refer others.

EigenLayer

EigenLayer, an Ethereum-based liquid staking protocol, has become the center of attention in crypto communities, especially for airdrop hunters.

EigenLayer has a feature called restaking — it allows ETH stakers to restake their coins on various Ethereum-based protocols, creating a robust blockchain ecosystem with pooled security using the restaked tokens.

The protocol has introduced several innovative features for yield farming and staking. The amount of active development and the points system that rewards its depositors has airdrop hunters carefully waiting for a potential token drop. Well, that and EigenLayer’s roadmap, which states that the team will launch the mainnet in Q3 of 2024, adding a payment and slashing systems.

How to qualify in case of a future airdrop:

1. Go to the app and connect your wallet.
2. Choose from any of the available pools
3. Stake rETH or sETH
4. Do this regularly to increase your chances to qualify

Base

Base, an Ethereum Layer 2 (L2) chain developed by Coinbase in collaboration with Optimism, offers a secure, cost-effective, and developer-friendly environment for on-chain applications.

There are speculations about a potential airdrop, mostly because Coinbase’s Chief Legal Officer has hinted at the possibility of a future token launch, so it’s not entirely ruled out.

Unsurprisingly, this statement sparked a wave of speculation, keeping airdrop farmers and Base users on alert for a possible airdrop anytime in 2024.

Early users may be eligible for an airdrop if they engage in regular transactions on the ecosystem using trusted protocols like the Rhino.fi bridge and trade on Dexes like Uniswap and Odos. Those are just some of the most popular apps on Base.

Risks & Security Practices to Consider Before Hunting Airdrops

Airdrops are becoming increasingly popular in the cryptocurrency industry, but just as their popularity grows, so does the number of risks that could endanger our financial positions and even sensible data.

• Wallets: having a crypto wallet is indispensable when participating in airdrops. Be sure to use a wallet with a robust algorithm to generate random seed phrases that are ultimately hard to crack by hackers.
• Tax Liability: airdrops are taxable in the US and other certain jurisdictions.
• Potential scams: not all airdrops are valuable, and some may be associated with scams or low-quality projects.
• DYOR: please do your research (DYOR) about a project, make sure you click on the correct links, double-check URLs, don’t sign anything unless you’re sure about its legitimacy, and exercise caution before participating in airdrops.
• Market Volatility: market volatility can cause airdrop tokens to experience chaotic price swings.

Welcome back Airdrop farmer! If you’ve been hearing buzz about retroactive lending airdrops, but aren’t quite sure what it’s all about, you’re in the right place. Strap in as we take a fun-filled ride through this exciting terrain!

Borrow & Lend

So, what’s the deal with crypto lending? Think of it like this: you’ve got some digital assets, maybe some Bitcoin or Ethereum, and you’re not using them at the moment. Instead of letting them gather dust (figuratively speaking, of course), you can lend them out to others and earn interest in return. It’s like putting your crypto to work while you sip on your morning coffee.

Now, onto NFTs – the new kid on the blockchain block. NFTs, or non-fungible tokens, are like digital collector’s items. They can represent anything from digital art to virtual real estate, and they’re all the rage right now. Buying, selling, and trading NFTs is like stepping into a virtual treasure trove where creativity knows no bounds.

But where do lending and NFTs intersect? Well, some platforms allow you to use your NFTs as collateral for loans. It’s like pawning your rare digital collectibles for some quick cash, except without the dusty old pawn shop vibes. Plus, you get to keep ownership of your NFTs – it’s a win-win!

Now, before you dive headfirst into the world of crypto lending and NFTs, there are a few things to keep in mind. First off, do your research. Not all lending platforms and NFT marketplaces are created equal, so make sure you’re dealing with reputable ones.

Secondly, be aware of the risks. Crypto markets can be volatile, and NFT values can fluctuate like a rollercoaster on steroids. Only invest what you can afford to lose, and always have a plan B (and maybe even a plan C) just in case.

Now that you understand the borrow & lend part, let’s dive into the lending airdrops.

List of Lending Airdrops You Can Farm

There are multiple options out there with announced or speculated airdrops. We’ll start with the straight-up lending ones, and end with the NFT lending airdrops.

1] MarginFi

Marginfi is a platform for cryptocurrency margin trading on the Solana blockchain, empowering users to leverage their crypto assets for larger positions while providing essential tools and data for successful trading.

Marginfi goes beyond crypto margin trading by providing traders with real-time market data, advanced charting tools, and customizable trading strategies.

Collect points for borrowing & Lending for a future airdrop.

2] Kinza Finance

Kinza Finance is a decentralized lending protocol on the BNB Chain, emphasizing ve(3,3)-inspired tokenomics and a Real Yield approach. Designed by seasoned Fintech and blockchain specialists, it draws inspiration from the Tokugawa shogunate’s gold guild, blending traditional finance concepts with contemporary DeFi practices.

Kinza Finance operates with KZA and its staked form, xKZA. Staking grants holders dividends and voting rights, while borrowers earn rewards. A conversion system encourages sustained participation by allowing a revert back to the original token.

5% of the supply is reserved for their retroactive airdrop.

3] Shoebill Finance

Shoebill Finance is a DeFi protocol operating across Wemix, Klaytn, and Manta ecosystems, offering leveraged investment opportunities where borrowing amplifies investment sizes, creating mutual benefits for investors and depositors. 

Shoebill champions a low-risk high-reward approach through token borrowing and re-staking, while assuring lenders stable yields backed by Liquid Stake Tokens (LST) as collateral. 

Earn Points with your lending activity for the future Airdrop.

4] Scallop

Scallop is a groundbreaking money market machine in the @SuiNetwork ecosystem, emphasizing institutional-grade quality, enhanced composability, and robust security.

Scallop offers high-yield lending and cost-effective borrowing opportunities, featuring a soft liquidation mechanism, and the innovative sCoin for enhanced user control.

This one is not confirmed but strongly hinted at doing a future airdrop.

5] Rain.Fi

Rain.fi revolutionizes the lending market on Solana, enabling the use of NFTs as collateral for lending and borrowing digital currencies like SOL, USDC, PYTH, and mSOL, blending traditional mortgage practices with the digital asset space.

For organizations, Rain.fi allows the integration of SOL liquidity pools on their websites, streamlining lending, while individual users can easily borrow SOL using their NFTs, linking digital asset ownership with accessible liquidity.

Collecting Droplets opens up a world of exclusive rewards and hints at a potential retroactive one.

NFT Lending Airdrops

Last but not least, let’s discuss the 2 biggest lending opportunities in the NFT world, on Ethereum.

1] Blur

Blur is a zero-fee NFT marketplace designed for pro traders, featuring a real-time aggregator that allows for sweeping and listing across multiple NFT marketplaces. BLUR is the first marketplace to offer advanced trading tools at no cost and incentivized royalties.

Blur Lending, also known as Blend, is an innovative Peer-to-Peer Perpetual Lending Protocol for NFTs, co-developed with @DanRobinson and @Transmissions11. It enhances yield opportunities and makes NFT ownership more accessible, mirroring the role of mortgages in real estate.

For the 3rd airdrop season, you collect points by bidding on blend lending. The riskier your loan, the more points you get. You don’t actually get points for lending, but you earn them by providing the loan bids (liquidity).

2] NFTfi

NFTfi is a leading liquidity protocol that allows NFT owners to use their NFT assets to access the liquidity they need through secured $ETH, $DAI, and $USDC loans from liquidity providers, peer-to-peer, in a completely trustless manner. The platform provides a seamless financialization of NFT-based economies through innovative mechanisms and highly user-friendly applications.

NFTfi’s lending process is simple and secure. Borrowers provide their NFTs as security and get loan offers from lenders. Lenders, in turn, use NFTfi to earn attractive yields or have a chance at obtaining NFTs at a steep discount to their market value. NFTfi’s platform also allows lenders to make private offers against entire collections or submit Standing Collection Offers (SCOs), which are valid for any currently listed NFT from a particular NFT collection.

Earn points for the future airdrop with lending volume.

Last Words

Lastly, have fun! Crypto lending and NFTs are about exploring new frontiers and embracing the digital revolution. So, grab your virtual pickaxe and start digging for digital gold – the lending aidrops await!

In conclusion, crypto lending and NFTs are like the peanut butter and jelly of the digital world – they just go together. With a bit of know-how and a dash of caution, you can navigate these exciting realms with confidence. So, what are you waiting for? Let’s dive in and discover what treasures await in the world of crypto lending and NFTs!

If you enjoy our content, you can support us by signing up for a Bybit Account with our referral link. Don’t forget to claim your bonuses if you buy/sell or trade crypto.

If you are neck deep into airdrop farming, you might also like our recent guides about Staking and Restaking Airdrops & 7 Wallets you need.

IRS tax season is officially open in the United States. April 15, 2024 is the deadline for crypto holders to report their 2023 transactions to the Internal Revenue Service (IRS).

The 2023 tax year includes any activity between January 1, 2023 and December 31, 2023. Late filings, failure to pay taxes owed and crypto tax evasion all carry potential penalties ranging from fines to jail sentences. We will cover these below.

2023 U.S. federal income tax brackets

Tax rate	Single	Head of household	Married filing jointly	Married filing separately
10%	$0 to $11,000	$0 to $22,000	$0 to $11,000	$0 to $15,700
12%	$11,001 to $44,725	$22,001 to $89,450	$11,001 to $44,725	$15,701 to $59,850
22%	$44,726 to $95,375	$89,451 to $190,750	$44,726 to $95,375	$59,851 to $95,350
24%	$95,376 to $182,100	$190,751 to $364,200	$95,376 to $182,100	$95,351 to $182,100
32%	$182,101 to $231,250	$364,201 to $462,500	$182,101 to $231,250	$182,101 to $231,250
35%	$231,251 to $578,125	$462,501 to $693,750	$231,251 to $346,875	$231,251 to $578,100
37%	$578,126 or more	$693,751 or more	$346,876 or more	$578,101 or more

Source: Internal Revenue Service
The tax brackets for U.S. federal income tax apply to short-term capital gains

2023 long-term capital gains rates

Tax rate	Single	Head of household	Married filing jointly	Married filing separately
0%	Up to $44,625	Up to $59,750	Up to $89,250	Up to $44,625
15%	$44,626 to $492,300	$59,751 to $523,050	$89,251 to $553,850	$44,626 to $276,900
20%	Over $492,300	Over $523,050	Over $553,850	Over $276,900

Source: Internal Revenue Service

How is cryptocurrency taxed in the United States?

For tax purposes, the IRS treats digital assets as property, not currency.

Generally speaking, this means most crypto-related activities will be subject to capital gains tax. However, there are some instances where the IRS views cryptocurrency gains from specific actions as ordinary income.

Here, the IRS makes the distinction between profits made when disposing of or selling cryptocurrencies and profits earned from other activities (for example, staking or airdrops).

There are no minimum thresholds involved with crypto tax reporting. Transacting any amount, even as little as $100 worth of crypto, still needs to be reported to the IRS.

Before we dive into taxable crypto events, let’s look at what crypto-related activities are tax-free.

Tax-free crypto actions

The following actions are not taxable events according to the latest guidance provided by the IRS:

• Purchasing cryptocurrency (including NFTs) using fiat currency
• Transferring digital assets (including NFTs) from one of your crypto wallets to another crypto wallet you own
• Minting NFTs
• Gifting cryptocurrency (subject to the per person gift limit: $17,000 for 2023 filing and $18,000 for 2024 filing).
• Depositing cryptocurrency as collateral for DeFi loans
• Donating cryptocurrency to charitable causes (subject to qualification noted below)
• Locking up digital assets in a staking smart contract (this does not include any rewards earned through staking)

It’s important to stress here that buying cryptocurrency using another cryptocurrency is a taxable event. The IRS considers this action a disposal, which we’ll explore below.

Additionally, charitable crypto donations can be tax deductible. However, an IRS memorandum mandates anyone claiming a tax deduction above $5,000 must obtain a qualified appraisal first.

Capital-gains-taxable actions

The following actions are taxable events according to the latest guidance provided by the IRS:

• Trading any digital asset for another (this includes stablecoins and NFTs)
• Selling digital assets for fiat currency (including metaverse items or property)
• Selling or using digital assets to pay for goods or services

Under this tax treatment, you only owe taxes if you’ve sold or otherwise disposed of a digital asset for a profit. The amount you owe is based on the difference between the price you paid for the asset (known as the “cost basis”) and the price for which you sold it.

There are two different capital gains tax rates for digital assets:

• Short-term capital gains
• Long-term capital gains

Which one you pay depends on how long you’ve held each investment.

Gains on the disposal of any digital asset investment held for one year or less are subject to short-term capital gains tax. Gains on the disposal of those held for over one year are subject to long-term capital gains tax.

The IRS taxes short-term capital gains at the same rate as your income tax bracket. See the tax bracket charts above for the latest figures.

The IRS taxes long-term capital gains at a lower rate, encouraging crypto investors to HODL assets.

You will usually “net” gains and losses; i.e. you apply a long-term capital loss to a long-term capital gain and a short-term capital loss to a short-term capital gain. If there are excess losses in one category, you can net these against gains of either type.

Income tax actions

The following actions are also taxable events according to the latest guidance provided by the IRS:

Any profits made from any of the above actions are considered ordinary income and taxed the same as short-term capital gains. See the U.S. federal income tax brackets table above for the latest federal income tax brackets.

Staking with Kraken

The IRS has published new guidance regarding the treatment of cryptocurrency staking rewards. In Revenue Ruling 2023-14, the IRS ruled that staking rewards must be included in gross income for the taxable year in which the taxpayer acquires dominion and control of the awarded cryptocurrency. Dominion and control generally refers to the taxpayer’s ability to sell or otherwise transfer or withdraw the asset. 

The ruling further clarifies that this treatment applies whether the taxpayer stakes directly to a proof-of-stake blockchain or receives additional tokens through staking on an exchange. The amount of includible income is based on the reward’s fair market value on the date the taxpayer gains dominion and control.  

Please consult your tax advisor for further guidance.

U.S. customers that received over $600 in staking rewards in 2023 will receive an IRS Form 1099-MISC from Kraken. Kraken will also send this form to the IRS. This form helps to calculate the amount required on your 2023 U.S. Income Tax Return.

You can learn more about IRS Form 1099-MISC here and the Kraken Tax Forms FAQ here.  Additionally, if you are not eligible for the Form 1099-MISC, you should still include any staking rewards that you received dominion and control over in 2023.

IRS Form 1099-B

Form 1099-B reports proceeds from the sale of stocks and other financial instruments. Form 1099-B may also report other details of the sale such as the cost basis and data for determining the taxable income for the transaction. U.S. taxpayers use this form to calculate their gains or losses from selling such instruments. Kraken does not currently issue Form 1099-B.  Depending on the finalization of the Proposed Regulations for Digital Asset Brokers, beginning in 2025, Kraken may have to report certain transactions involving options and forward contracts on the Form 1099-B.

IRS Form 1099 reporting on crypto sales

The Infrastructure and Investment Jobs Act, signed on November 15, 2021, requires cryptocurrency “brokers,” like Kraken, to report the sale of Digital Assets to the IRS similar to what you would see in traditional finance (like a Form 1099-B). The IRS issued Proposed Regulations for Digital Asset Brokers, and in these proposed regulations deferred the requirement to report digital asset transactions on a proposed Form 1099-DA until the year 2025. A large number of responses were received on the proposal from industry and taxpayers that we would expect to be analyzed before any temporary or final regulations are issued.

Given that the regulations are only proposed at this time, and may be subject to change in the future pending the Final Regulations, please check the Tax section of our Support Center going forward for updates.  Additionally, forthcoming U.S. tax regulations will require reporting transfers of Digital Assets from other exchanges and wallets, and we anticipate incorporating the reporting requirements of these regulations when they are effective.

Kraken, for tax year 2023, will not be filing Form 1099-B (nor equivalent such as the proposed Form 1099-DA) with the IRS, nor are we issuing Form 1099-B to customers. Instead, we provide you with the ability to download your account history, as described below.

How to calculate and file your crypto taxes

Calculate your cost basis

For investors that only complete a handful of digital asset transactions per year, calculating taxes is a relatively straightforward process. For people who are highly active in the crypto space and engage with multiple platforms and assets, it can be significantly more complicated.

Thankfully, the IRS accepts several methods for calculating the cost basis of investments subject to capital gains tax. It’s important to note that the amount you’ll pay in taxes can vary depending on which option you choose.

• First in first out (FIFO): Digital assets bought first are the first assets sold
• Highest in first out (HIFO): Digital assets bought at the highest price are the first assets sold
• Last in first out (LIFO): Digital assets bought last are the first assets sold
• Specific identification (Spec ID): You calculate the specific cost basis for each transaction

We also want to note that you should be including fees as adjustments to your cost basis and gross proceeds. This adjustment will impact your gain/loss calculations.

If there was an acquisition fee when you purchased cryptocurrency, you can add that fee to your purchase price to increase your cost basis. Similarly, when you sell cryptocurrency, you can deduct the selling fees from your proceeds. This deduction is beneficial because it results in lower gains or higher losses.

Third-party service providers (crypto tax calculators)

Kraken provides you with the ability to download your account history for all of your trades and other account history on your Kraken account. Third-party providers that provide crypto tax calculation services can assist you with calculating your crypto taxes utilizing the CSV file downloaded from Kraken.

Certain third-party service providers may suggest that they can more readily calculate your taxable income if you connect your Kraken account to their site via an application programming interface (API). 

We do not endorse any third-party service providers. We understand many of our clients use these services particularly when they have accounts at multiple exchanges or wallets and recommend the following best practices to keep your account and information safe while using the provider that best suits your needs:

• Review the third-party service provider and understand what security they have in place to keep your information secure
  • For example, is 2FA available or have there been previous breaches?
• Limit the information shared via an API to the following selections: query, query closed orders and trades, and query ledger entries
• Review the output and verify the accuracy and completeness
• Delete the API key from your Kraken account once you receive the tax reporting from the third-party service provider; this will limit any further access to your account

Future Enhancements

We look forward to sharing future enhancements to our tax reporting capabilities, including updates to our CSV files to better integrate with third-party software providers.

Filing your crypto taxes

Once you’ve calculated how much tax you owe, you’ll need to complete the following forms.

Page 1 of Form 1040 requires you to affirmatively state whether, at any time during 2023, you: (a) received (as a reward, award or payment for property or services); or (b) sold, exchanged or otherwise disposed of a digital asset (or a financial interest in a digital asset).

Check “Yes” if at any time during 2023 you:

• Received digital assets as payment for property or services provided
• Received digital assets as a result of a reward or award
• Received new digital assets as a result of mining, staking and similar activities
• Received digital assets as a result of a hard fork
• Disposed of digital assets in exchange for property or services
• Disposed of digital assets in exchange or trade for another digital asset
• Sold a digital asset
• Otherwise disposed of any other financial interest in a digital asset

The following actions or transactions in 2023, alone, generally don’t require you to check “Yes”:

• Holding a digital asset in a wallet or account
• Transferring a digital asset from one wallet or account you own or control to another wallet or account that you own or control
• Purchasing digital assets using U.S. or other real currency, including through the use of electronic platforms such as PayPal and Venmo

For capital gains tax, you’ll need to complete Form 8949. If you’ve reported losses, you may be able to deduct the amount from your capital gains tax liability. To do this, you will need to complete Form 1040, Schedule D.

For crypto-based income taxes, most people will be required to complete Form 1040, Schedule 1 or Schedule C.

However, depending on your status, you may be required to complete a different type of 1040 form.

• Form 1040–SS: Applicable to residents in Guam, American Samoa, the U.S. Virgin Islands (USVI), the Commonwealth of the Northern Mariana Islands (CNMI) and Puerto Rico
• Form 1040-NR: Applicable to people considered “nonresident aliens”

Penalties

Crypto tax evasion can lead to severe penalties. The IRS can issue fines up to 75% of unreported crypto gains (a maximum of $100,000 for individuals and $500,000 for corporations) and a tax year audit may remain open indefinitely. There may be other penalties applicable depending on your particular tax circumstances.

Additionally, criminal convictions can result in a five-year jail sentence.

If you’re unsure how to calculate or file your tax returns, it’s advisable to seek guidance from a tax professional.

Keep learning about crypto

Now that you understand how your digital asset investments are taxed, check out our Learn Center for more essential crypto knowledge: