[ExI] bitcoin again

[Stathis Papaioannou]

On Sat, 26 Nov 2022 at 11:37, spike jones via extropy-chat <
extropy-chat at lists.extropy.org> wrote:

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> *…*> *On Behalf Of *Stathis Papaioannou via extropy-chat
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> >…Is there any evidence FTX did not pay the taxes they legally had to pay?
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> Stathis Papaioannou
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> Stathis it isn’t clear to me they had any tax obligation.  To have that,
> he would need actual profits.  My theory is that Bankman Fried’s business
> had no traditional taxable earnings, but rather was a Ponzi scheme from the
> start.  So… no profit, no tax bill.
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> With that observation, my prediction is doubly cynical.  I am suggesting
> Bankman Fried is an actual thief but not necessarily a tax code violator.
> Profit is legally-earned and is taxable.  Stolen funds are tax-free.
> Further, I predict that the authorities won’t bother trying him in criminal
> court but the tax man will find a way to end up with any remaining assets
> they can get their grubby paws on.  This is a full frontal attack by the US
> government on cryptocurrency exchanges, motivated by a fear that money is
> being made without their getting a cut of the action.
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The deception was that customer funds were used to prop up a risky but
supposedly separate part of the business, Alameda Research, by giving them
loans using a token they had created as collateral, which amounts to giving
unsecured loans, since if the business fails the token would be worthless.
That may or may not classify as fraud, I’m sure there would be many be
legal argument. An exchange that just holds customer assets and charges a
fee for trading them (as most exchanges do) cannot really lose the assets
unless an external party or insider actually takes them. Such exchanges
only make profit from fees and pay tax on this profit, while the customers
pay their own tax if they make a capital gain, which only occurs if they
realise a capital gain.
-- 
Stathis Papaioannou
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