Giving cryptocurrency as a gift is easier than you think

[ad_1]

Coinbase digital gift card art.

Coinbase

Amid persistent economic uncertainty, rising inflation, and global supply chain issues, what if you could find a highly available and easy-to-give holiday gift? What if this gift also straddles the border between the strategic and the strange? Yes, we are talking about cryptocurrency.

Although most Americans are familiar with cryptocurrency, only a small percentage of them know how to give cryptocurrency as a gift. If you are one of the few, this is your chance to lead the way for your friends and family.

Unlike in the past, it is now easy to offer cryptocurrency, even to those who don’t know the difference between a hardware and software wallet or who don’t have an account on a cryptocurrency exchange. And you don’t even have to donate an entire bitcoin, which currently costs over $ 50,000. You can send fractional minutes of a cryptocurrency, starting at less than $ 1.

Here we’ll focus on the big, popular players who made it easy to offer cryptocurrency safely to your friends and family, even if you or the recipient has never touched digital money before.

Cryptocurrency made easy

A growing number of mainstream financial apps, including PayPal and Venmo, have already made it relatively easy to purchase cryptocurrency, although some charge higher fees than crypto-focused apps and exchanges. And not all of them make it easy to send cryptocurrency as a gift, especially to people who don’t have an account yet.

In March, Cash App launched a new feature that allows users to send bitcoin to anyone with a phone number or email address. Coinbase then unveiled a similar feature, making it easy for account holders to send bitcoin, ether, and several other cryptocurrencies to anyone with an email address, whether or not they already have one. Coinbase account.

There are other ways to give cryptocurrency as a gift without using centralized exchange and financial app. These will require more technical know-how. And no matter how you give the gift, it’s worth giving your recipient a warning: the world of cryptocurrency can be a wild place where scams and misinformation are common.

How to send cryptocurrency on Coinbase

To send cryptocurrency as a gift, you will need a Coinbase account. Starting today, you will be able to access the giveaway feature on the company’s app and website. From the menu on the left side of the screen, select “send a gift”.

The new giveaway feature lets you send five different assets – bitcoin, ether, litecoin, bitcoin cash, star lumen – to anyone, including people who don’t have a Coinbase account yet. All you need is their email address. The email contains instructions on how to create a Coinbase account and claim the gift. The email also includes a digital card containing “crypto-focused artwork.” There are no charges beyond the cost of the cryptocurrency you are offering. If the recipient already has an account, you can send them any of the assets supported by Coinbase (there are over 100).

Coinbase allows you to cancel the transaction at any time until the recipient creates their account and claims the cryptocurrency. If the person does not create an account within 30 days, the transaction is automatically canceled.

Offer cryptocurrency with Cash App

Cash App is a popular money transfer service owned by Block, formerly known as Square. One of the features of Cash App is the ability to send bitcoins to other people. This application makes it possible to quickly and easily offer cryptos.

However, your choice of cryptocurrency is limited to bitcoin. At the moment, Cash App does not support any other assets, which makes the platform somewhat restrictive for cryptocurrency enthusiasts. But if the recipient is new to digital currency, then bitcoin is probably the only asset they might know about.

To send bitcoin to another Cash App user, you will need the person’s address on the Cash App, called $ CashTag. Once you have the $ CashTag in hand, navigate to the Bitcoin tab from the home screen. Then press the airplane button and select the amount you want to send and the person to send it to.

If the person you’re sending to doesn’t have a Cash App account, you can send them bitcoin using their phone number or email address. The person who receives your gift will then be invited to create an account and accept the bitcoin. If the recipient does not create an account within 14 days, the bitcoin will revert to your account.

You can send as little as $ 1 in bitcoin using this service. You can find the full instructions on the Cash App website.

Give a cryptocurrency wallet as a gift

Alternatively, or in addition, you can give someone a cryptocurrency wallet as a gift – with or without anything in it. These are hardware wallets that plug into your computer through a USB port. If you decide to set up a hardware wallet for someone as a gift, be sure to follow the manufacturer’s instructions carefully and keep track of the keyphrases once you’ve set up the wallet. Trezor and Ledger are two reputable manufacturers that offer models ranging from $ 60 to $ 200.

A note on taxes

Typically, the IRS focuses its interest on donations of $ 15,000 or more. So if you are only sending $ 50 in bitcoin to your cousin, you shouldn’t have to worry about the tax implications. The IRS has helpful gift and virtual currency taxes pages to help you navigate through the details. And when it comes to reporting your transactions in April, taxes usually don’t come into effect until you sell or trade.

Real risks and potential rewards

This year alone, the price of a single bitcoin has fluctuated wildly, from a low of around $ 30,000 to an all-time high of over $ 65,000 in November. A lot of people have made money from cryptocurrency speculation, but it is just as easy to lose money. While this can make a fun gift for the holidays, keep in mind that cryptocurrency assets are highly speculative, and if you do buy them, a good rule of thumb is not to invest more than you are. comfortable losing. It should also be noted that cryptocurrency is a common tool in online scams, and cryptocurrency transactions – once completed – are usually final and irreversible. Once you send crypto, it’s like a party forever. Do your homework, be skeptical, and have fun.

[ad_2]