Searching for a Compromise: A Case for the Crypto Like-Kind Exchange

In recent years, cryptocurrencies, cryptoassets, electronic coins, tokens, non-fungible tokens, and other various terms for electronic assets have gained prodigious attention in the financial world. From the spike (and subsequent drop) in value of Bitcoin, to people spending millions of dollars on pixelated pictures of punks, the market for these assets has been extremely active despite its ups and downs. However, in addition to potential financial success via crypto markets, the development of crypto technology has allowed for a transformation of how individuals and institutions think of currency, financial security, and access to information Part I of this Comment explains what a cryptoasset is, as well as the current tax regime applicable to them. Part II defines like-kind exchanges and provides the historical context for the nonrecognition event. It also considers the IRS’s recent guidance pertaining to crypto like-kind exchanges. Part III puts forth this Comment’s main arguments for allowing crypto-for-crypto exchanges to qualify as like-kind exchanges.