How the “buy, borrow, die” tax trade is quietly loading DeFi pools with hidden credit risk
Imagine someone who bought ETH for $1,000, watched it climb to $4,000, and now wants to cash out $1,000. Selling one-quarter of the ETH would provide the cash, but it would also realize a $750 gain under US tax treatment of digital assets held for investment. However, DeFi offers another way. The owner can deposit […] The post How the “buy, borrow, die” tax trade is quietly loading DeFi pools with hidden credit risk appeared first on CryptoSlate.
Key Takeaways
- Imagine someone who bought ETH for $1,000, watched it climb to $4,000, and now wants to cash out $1,000.
- Selling one-quarter of the ETH would provide the cash, but it would also realize a $750 gain under US tax treatment of digital assets held for investment.
- However, DeFi offers another way.
Summary generated by IndiCrypto from CryptoSlate. IndiCrypto is a news aggregator and does not provide investment advice. Read the original article for full context.
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