Bitcoin's Nominal Gain Conundrum: Taxing Inflation's Illusion

The recent 22% weekly increase in Bitcoin's price has sparked debate among investors about whether to pay capital gains tax on nominal gains.

The US Treasury Capital Gains Indexing Authority has unclear rules regarding it, and some argue that taxing nominal gains is unfair when inflation erodes the value of money.

Grover Norquist, President of Americans for Tax Reform, warned that 'the government creates inflation, the government shouldn't profit by the inflation they create by raising taxes on people who own crypto.'

The Treasury Department's new program added liquidity support buybacks for longer-dated nominal coupon securities, and some argue that this adds to the argument for indexing capital gains to inflation.