IRS 988 says regular income

[hopefultxn]

Sorry, but I believe you are incorrect... Publication 525 specifically states that profits from foreign currency exchanges exceeding $200 based on changes in exchange rates is to be claimed as capital gains, not ordinary income:

Foreign currency transactions. If you have
a gain on a personal foreign currency transac
-tion because of changes in exchange rates,
you do not have to include that gain in your
income unless it is more than $200. If the gain
is more than $200, report it as a capital gain.

Page 33 : http://www.irs.gov/pub/irs-pdf/p525.pdf

[hopefultxn]

For the basics, the tax code is not as confusing as people try and make it out to be... The biggest problem seems to come when people search the tax code for the wrong terms, such as 'foreign investment'...

If this pans out the way everyone is wanting it to, then there will be more than enough profit for people to hire a tax professional to handle this. If it doesn't, and say Iraq redenominates their currency in a manner that reflects no gain in value for currency speculators, then it is all a moot point since there will actually be a loss in overall value due to exchange fees and premiums price paid from the original purchase.