Nostr Web Client

Cost basis zero is always an option, and afaik is not uncommonly used if you don't have good evidence of a nonzero cost basis. (Although to get better discussion it's a good idea to mention what country you're in!).

paxchristi 4mo ago

Thanks! A major European country using FIFO, and if I were to guess a not so tech savvy and capable tax office (could be wrong here though).

My question would apply broadly though to most major western countries, the question really is if I have a bunch of no-kyc utxos, if in the future I need to convert back to fiat (house, big purchase) - what 'do I say/do'. I mean I get the no-KYC, and that the future hopefully is one where we can exchange bitcoin for goods and service directly with our 'neighbor'. But in the near term, I don't want to have bitcoin that is 'stuck' in no-KYC land if I need it for an emergency.

Hope this makes sense and thanks for replying.

Reply to this note

Please Login to reply.

Discussion

waxwing 4mo ago

Tax and house purchase are 2 different things right. For the latter, I can only say that I know that in several countries, providing evidence for the source of funds is, nowadays, a requirement. But it doesn't need to be perfect evidence, just, evidence that is plausible enough for e.g. notaries, lawyers. I *think* this is true (nowadays) across basically all "developed" countries, but I'm not sure.

paxchristi 4mo ago

I was just using house as an example of having to sell bitcoin and create a taxable event.

A lot of people here are (rightly) pushing no-kyc purchasing of bitcoin. I’m essentially wondering how are these people going to ‘use’ this bitcoin in a kyc/fiat world if they need to? Because in my mind using no-kyc coins for large purchases isn’t possible without alerting taxman/govenrment/bank etc

waxwing 4mo ago

Yes. The tough question is, indeed, if you want to do larger purchases but also stay kyc free, it's nearly impossible in today's world. Note that that doesn't imply it's worthless to stay kyc free. But then also note that staying kyc free totally, could make certain purchases impossible. No easy answers; even the lazy answer "always use kyc" will carry its own, separate, risks.