New York Considers 0.2% Cryptocurrency Tax to Fund School Programs Amid Market Liquidity Concerns

• The tax, outlined in Assembly Bill 8966, is expected to begin on September 1, 2025, affecting exchange operators and payment processors.

• The initiative mainly targets transaction facilitators, sparking mixed reactions from stakeholders in the cryptocurrency industry.

• Historical vulnerabilities indicate that similar taxes have influenced market activity, potentially leading to significant liquidity changes.

New York proposes a 0.2% crypto tax to fund educational programs. Understand its implications for crypto liquidity and trader sentiment in this comprehensive overview.

What is New York’s Cryptocurrency Tax?

The proposed 0.2% excise tax on cryptocurrency and NFT transactions, introduced under Assembly Bill 8966, is planned for implementation on September 1, 2025. This tax aims to generate funds specifically for educational programs targeting substance abuse issues in upstate schools.

How Will the Tax Impact the Crypto Market?

The legislation primarily affects transaction facilitators, like exchange operators and payment processors, leaving retail traders largely untouched. However, concerns regarding potential declines in market liquidity and hesitancy from institutional investors have emerged. Historical regulatory actions, such as the BitLicense, have already shown significant effects on market dynamics, making stakeholders wary of the new tax.

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