Crypto lenders push no-tax perk of leveraging Bitcoin for cash

New York: Former Wall Street trader Edgar Fernandez used some of his Bitcoin as collateral to borrow nearly $100,000, a move that let him keep his cryptocurrency and avert a tax bill on the newly acquired cash.

The tax perk stems from a longstanding principle that assets aren’t taxed until sold, much like borrowing against stock holdings. Yet digital currency carries far greater risks, from price volatility, to hacks and thefts that can make the collateral disappear, to sometimes shadowy players without long track records in the field.

Since last fall, when the value of digital money plummeted, lenders have been pushing people who have paper profits to leverage them into cash by borrowing against their cryptocurrencies.

Read more

You may also like

More in IT

Comments are closed.