He’s worried about the tax consequences of that
Which is very understandable
Discussion
Maybe he can switch for stable coin and send stable coin elsewhere to purchase again. I assume that would not be taxable. Cuz he didn’t cashout.
Any exchange is considered a sale, therefore taxable. They basically treat crypto like stocks. You cannot swap stocks
Changing from Bitcoin to stablecoin is considered a sale. It’s like if you sell Walmart stock to buy Costco stock you have to pay taxes on that.
Even you invest it immediately?
Yeah, timing doesn’t matter.
There is a possible exception for certain kinds of real estate if you do it in a certain way, but for everything else any sale, exchange, or transfer is considered a sale unless it’s to a legally registered charity as a donation with a donation receipt.
Unfortunately I think he’s probably fucked and about to get an expensive lesson in why self custody is superior. No judgement, I feel bad. That sucks super hard. Coinbase is just known for refusing to fix this kind of fuckery. Share my sympathies.
He is already KYC. A transfert is considered a sale unless you keep track of the other receiving address and write it off as a transfert.
If he doesn’t want to declare his gain now, might as well leaving it there
This is not good advice... Of course you tell them it is a transfer. Transfers aren't taxable events.
Self custody with KYC is still objectively better than custody with KYC.