Knowing how cryptocurrencies are taxed and regulated can be confusing. Here are a few frequently asked questions to help clear up some confusion.In a simple answer, no it is not. This is because cryptocurrency is treated as property, meaning the general tax principles that are applicable to property transactions will apply to cryptocurrencies Yes. A taxpayer that is failing to maintain adequate records faces serious consequences. They can impose penalties for negligence or fraud, or require the taxpayer to use an IRS prescribed method to determine their income. It is crucial that any taxpayer that has gains from cryptocurrencies, must be prepared to report them on their individual income tax return.The chairman of the SEC, Jay Clayton made it clear that they have interests and responsibilities when it comes to cryptocurrencies. They did however express caution for those offering ICO ’s, saying that they would be subject to securities laws. Some of the coins that are for sale are also subject to SEC regulation, and some require a license to be able to sell them. Without the appropriate license they could violate federal securities laws. The SEC has not formally said that cryptocurrencies are securities making them subject to securities laws; however, they have taken the lead in prosecuting related cases, appearing that they are in fact heading in that direction.No, they are not. When you invest in cryptocurrencies, the tax payer might find it more difficult to determine if they own other accounts for FBAR reporting purposes. The regulations state that bonds, notes and stocks of foreign issuers held by a reporting person are not financial accounts; however, other financial arrangements are not as clear.Yes, they can. The Internal Revenue Code does not describe what a retirement account can invest in, only what it cannot.