Originally published at: Crypto is very good at showing Melania's NFT team bought her own NFT | Boing Boing
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I wonder if this is this a common thing in the real-life art market too, where (say) some artist buys their own painting from their own gallery for a ridiculous sum just to convince other people that their work is valuable?
Of course, if you buy your own shitty painting you at least get to have a shitty painting to show for it.
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As far as i know this is called wash trading and yes it happens in all kinds of markets, its illegal but you know how people do. And NFTs are notorious and widely known for this to drive up fake interest into crypto and NFTs
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There are several reasons to do stuff like that.
- Money laundering. Buy a cheap painting. Sell to yourself for a much higher price and pay with dirty money, and suddenly you have money legitimately earned from a profitable trade.
- Evading taxes. Buy a cheap painting, boost the price and then donate it for the now much higher price so you can deduct it from taxes.
- And as you say, just keeping prices up, because you have lots of similar works. Lots of trading in NFT:s are that kind of wash trades.
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So glad I cashed out my crypto positions several years ago. What a cesspool it’s all become.
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Always was one.
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oh melania. the truth always comes out in the wash (trade).
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and if you are a trump…all 4.
yes, yes i know you only listed 3, but really…you know they found another illegal benefit.
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The article notes a possible, but implausible explanation:
Trump said “the nature of Blockchain protocol is entirely transparent. Accordingly, the public can view each transaction on the blockchain. The transaction was facilitated on behalf of a third-party buyer.”
Whenever it comes to Trump family, Occam’s razor always leans towards grift.
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i have a little bit tied up in crypto mainly did it out of curiosity. Maybe put in initially about 150 or 200 bucks, currently waiting for all of it to be over a year old so i can cash it out and not need to file taxes on them
just watch out for the Razzlekhan… she’s coming for your coin.
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Hey, I wouldn’t buy from a company that didn’t believe in its own products!
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I didn’t find it likely that anyone would buy the stupid thing and… looks like that instinct was correct.
It’s kind of amazing how much stuff, that’s completely illegal in any other context, happens on a regular basis in the crypto/NFT space because of a total lack of regulations. So wash trades end up being over 80% of the actual transactions in the markets.
Wash trading in art probably doesn’t remotely happen that often because, as you say, illegal, but also because financially it quickly becomes not worth it - you have to pay a sales tax on a non-existent sale, and unless you own the gallery, a significant cut goes to them, so you actually lose substantial amounts of money each time - which isn’t true for NFTs, where there might be a transaction fee, but otherwise it’s just moving cryptocurrency from one wallet to another.
Also, with the Trumps, they don’t want to lose face. The last thing they wanted was to embarrass themselves with a weak first sale - much better to take the loss, appear strong and keep the grift alive for another day.
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indeed. and, donnie has done it before
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What I want to know is why $170K? Is 1 million too obvious (or does she not even have that kind of liquid cash?) but $10K not impressive enough? Did she, like, hire an analyst to find the sweet spot for how much to pay herself? Or did it just happen to be that month’s laundering bill?
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The auction house takes a cut, so you want it to look like it’s worth something without bidding too much.
I see a lot of completed sales on ebay for prices suspiciously above market value. I used to think they were trying to artificially inflate prices, but thanks to this thread I now know it is probably money laundering.
Does crypto have some sort of exemption from long term capital gains tax? I have heard that only about 5% of owed tax on crypto transactions is paid and this sounds like that.
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If i understand your question, I don’t think it has an exception but it depends on the amount of money you’d be making. The taxation rate varies from 0 to 20%, so to relate it to myself what i’ve put into crypto is low enough that i’m not expecting to be taxed though if i did sell i would still need to report it
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