With a little spare time, you and a friend can end up owing the Federal Government $373 trillion dollars *today*, and we can completely wipe out the national debt.

crypto basset hound

Imagine the following scenario:

  1. You create a new nft out of thin air, named “Fucking”. It is a single nft. You own that nft.

  2. “Fucking” has no value. It was just created.

  3. Your friend creates a new cryptocurrency named “Stupid” and issues 10 quadrillion coins (ten thousand trillions). They have no value, they were just created out of thin air.

  4. He then sells a single “Stupid” coin to a third person for $1. That third friend then also puts out a standing offer that he’ll buy another “Stupid” coin for another dollar, if your friend is willing.

  5. Stupid now has a marketcap of $10 quadrillion dollars. Remember that marketcap is a function of total number of coins x the current going price. That’s it.

  6. “Stupid” only has liquidity of a single dollar – that person that offered to buy another one for another dollar. But that doesn’t change the raw price nor marketcap.

  7. Remember your NFT, “Fucking”? Your friend agrees to buy your NFT for 1 quadrillion Stupid. You sell it to him.

  8. You now own 1 quadrillion Stupid valued at $1 quadrillion dollars. And good job, you just created a taxable event.

  9. It doesn’t matter that you didn’t convert to dollars; by the current law, crypto to crypto trade is considered a capital gain, and you must pay taxes on the value of it. Since your income this year is now $1 quadrillion dollars (from the sale of the NFT), you are getting hit with the maximum capital gains tax of 37% of that sale.

  10. You owe the Federal Government $370,000,000,000,000. It doesn’t matter that your Stupid is actually worthless. It doesn’t matter that the liquidity is one dollar deep and you could never actually even sell enough to obtain enough money to pay even a fraction of a sliver of that tax. All that matters is by exchanging one made up thing for another, the Federal Government suddenly has decided that you owe them a titanic sum of money you never had in the first place.

Welcome to current US tax laws. The best part is, since you would never be able to pay your 370 trillion dollar tax bill, the IRS would seize everything you owned that they could. That includes your 1 Quadrillion Stupid. But there’s good news! Since your 1 Quadrillion Stupid is valued at 1 Quadrillion Dollars you just single-handedly wiped out the national debt and brought America into a new age of prosperity. Bravo!

submitted by /u/katiecharm
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