Cryptocurrency is the future of money, but it’s also a little intimidating. When you’re trying to figure out how to gift cryptocurrency, it can be hard to know what kind of person your recipient is and how much money they may have already invested in cryptos.
Fortunately, there are some simple steps you can take that will make this process easy and fun for both parties involved:
Find out if a recipient is interested in cryptocurrency
Gifting your loved one cryptocurrency is probably the best surprise you can give. This is because it’s the future of money.
Carl Runefelt, an expert on cryptocurrency, who himself has invested in more than 360 crypto startups, says on his YouTube channel, The Moon, “Keep accumulating all the time within your budget essentially and I think the big goal that is of course a cool thing is to own one Bitcoin because one Bitcoin is actually now quite expensive but soon it is going to be absolutely unobtainable for a normal person.”
Once you’ve decided that your recipient is interested in cryptocurrency, it’s time to get down to business. Don’t hesitate to ask if you have any questions about which cryptocurrency exchanges are best for gifting and how much money they should buy with their new digital cash!
If the person you’re buying a gift card for doesn’t know anything about bitcoin or altcoins, some things can help them understand the basics of this new world order:
Ask what they think of bitcoin or other cryptocurrencies so far. Are they excited? Worried? Unsure? Do they see themselves using these technologies at all? How often do they check their online newsfeeds or social media feeds for updates on blockchain technology and crypto-related news stories?
Choose your cryptocurrency
The first step to gifting cryptocurrency is choosing the right one. You should choose a coin with a high market cap, meaning it has a lot of value and can be easily sold or used as currency.
Bitcoin (BTC), Litecoin (LTC), Ethereum (ETH), and Monero (XMR) are all good choices for gifting cryptocurrency because they’re widely accepted and easy to buy online.
Set up an account and get your wallet address
The first step is to set up an account and get your wallet address.
A wallet address is a code that identifies you as a cryptocurrency user. It’s like your bank account number, except instead of having one for each bank branch, you can have one for all crypto accounts—like Coinbase or Binance. You can find these on the websites where they sell cryptocurrencies (like Coinbase). Just enter the name of their service in their search bar and click “Get Started.”
If someone else has already generated this for them at some point in time, then there’s no need for further action! However, if not, then follow these instructions:
Buy the cryptocurrency
Check the exchange rate. Before you buy, check to see if the price of your cryptocurrency is still at its highest point. If it has fallen in value, wait until it rises again before making your purchase.
Buy from a reputable exchange like Coinbase or Binance, as they have been around long enough to be trusted by most people and will give better prices than smaller exchanges which may lack these protections or have fewer safeguards against hackers trying to steal their clients’ money (hence why they don’t offer these features).
Note: Never use an untrusted exchange: if someone wants access to your personal information, then they can do so regardless of whether or not there are protections built into the platform itself!
Use a credit card or bank transfer instead of Paypal if possible because these methods provide better security against unauthorized transactions
Send the gift to your friend’s wallet address
If you want to send cryptocurrency, the easiest way is to use a wallet address. A wallet address is a long string of letters and numbers that looks something like this:
hxxps://bbxcxmsdhyxk.onion/address?algorithm=sha256&amount=0.001&signature=d9a94f52afc822e3274e784702b153083dd18f46dfeb238fa63c78195495848
These are some of the steps you can follow to the person you are gifting:
- Provide written instructions on how to receive and hold the cryptocurrency
- Describe the process of receiving and holding cryptocurrency.
- Explain how to store your newly received cryptocurrency in a wallet.
- Explain how to use the cryptocurrency if it’s used for something specific (such as buying food or clothes), or if there are any limitations on its use.
- Provide instructions on selling or exchanging your digital assets if that’s what you want from this gift!
Get expert tax advice if you’re giving more than $15,000 to any one person
If you’re giving cryptocurrency as an investment or gift, it’s important to seek tax advice from a professional before you make the gift. Tax laws change frequently, and there can be significant tax implications for gifting cryptocurrency.
A good place to start is with your accountant, who has experience dealing with these issues. If your accountant doesn’t have experience in this area, find someone who does and ask them for recommendations on how best to structure your transaction.
Takeaway:
The takeaway is that there are no legal restrictions on gifting cryptocurrency as of writing this article. However, there may be tax implications if you gift more than $15k to one person or organization.
If you’re not sure about your specific situation and need further guidance on this topic, consult a tax professional who can help determine what type of gift would be most advantageous for your particular circumstances—and whether it’s worth paying taxes on the transaction itself (which could be difficult).
