The smart contracts that underpin NFTs mean that, unlike traditional art auctions, the original creators can ensure they take a cut of any future sales too. Most of the OG meme NFTs are being auctioned via Foundation, which gives a standard ten per cent share of any future sales to the person who minted the original NFT.
DeFi challenges this centralized financial system by disempowering middlemen and gatekeepers, and empowering everyday people via peer-to-peer exchanges.
“Decentralized finance is an unbundling of traditional finance,” says Rafael Cosman, CEO and co-founder of TrustToken. “DeFi takes the key elements of the work done by banks, exchanges and insurers today—like lending, borrowing and trading—and puts it in the hands of regular people.”
Crypto taxes are based on a 2014 IRS ruling that determined cryptocurrency should be treated as a capital asset (like stocks or bonds), rather than a currency (like dollars or euros). This decision has major ramifications for people who own crypto, as it opens them up to more complicated taxes.
Capital assets are taxed whenever they are sold at a profit. When you purchase goods or services with cryptocurrency, and the amount of crypto you spend has gained in value over what you paid for it, your spending incurs capital gains taxes.