> However, gains made from trading assets, including property, were taxed, and that caught crypto investors as the dominant reason for buying crypto assets is to later sell make a gain, rather than holding them as a long term asset like a home, or rental property.
Unfortunately what constitutes “trading” vs “holding” is ill defined in NZ law. At least with shares you can make a case you’re holding them for dividends, that defence isn’t available for crypto.
I don't think this is specific case here; seems more like less sophisticated investors buying new products don't know that selling them triggers a capital gain at the time of the transaction, regardless of what they may do with the proceeds AFTER the transaction date. In a nuteshell: a successful investment and an unsuccessful investment will be treated as independent events at the time the transaction occurs.
It's also not immediately obvious to the uninitiated what should happen when you swap one asset for another, like when you trade DOGE for BTC. Or trade between BTC and a stablecoin, if you feel clever and think this avoids triggering capital gains.
Imho it's all just forex trading, but ask 3 tax authorities and you get at least 4 opinions so you really have to know the local rules
> It's also not immediately obvious to the uninitiated what should happen when you swap one asset for another, like when you trade DOGE for BTC.
When I swap between MSFT and AAPL, I trigger capital gains, because sale of one realizes my (formerly paper) gain or loss.
Why should crypto be privileged? Why should people who don't even understand how traditional investments work, and are speculatively trading in a novel instrument get to cite ignorance as an excuse?
why not? there are lots of crypto that yields profit by holding it