IRS Guidance Further Legitimizes Bitcoin, but Demands Unrealistic ReportingMarco Santori The Bitcoin Foundation appreciates the IRS hard work in providing much-needed clarity to those transacting in digital currencies. The digital currency industry has, on the whole, welcomed greater regulatory clarity for its ability to foster innovation in this critical and emerging space. However, tax treatment of Bitcoin as a property, and not a currency, may make compliance with tax laws unnecessarily cumbersome and imposes untenable recording and reporting requirements on its users. This is an unwelcome result for most bitcoin users, but is particularly detrimental to those that Bitcoin can help the most: small business and underbanked individuals. When it is used as a currency, Bitcoin should be a frictionless means of paying for goods and services. The tax laws currently permit individuals to ignore small gains and losses in foreign currencies. Similar treatment for digital currencies would harmonize the law with the way most people actually use digital currencies. Artificially characterizing this use case as a transaction in property would make one of the most innovative features of this technology hard to use for those who wish to be compliant. The Bitcoin Foundation welcomes the opportunity to provide more formal comment to IRS in the coming weeks. The official notice from the IRS can be found here. 