Bored Ape sold for x1000 lower price
Not all bored monkeys bring wealth and joy. Some of them come with losses.
An interesting situation appeared this Sunday in the OpenSea market, where Bored Ape #6464 NFT was sold for 200 USDC or $200. Shortly after, the same NFT returned to the market, but with a much higher price of 200 ETH ($407.8K).
Ape #6462 was purchased for USDC 200.0 https://t.co/u3lQymdO1B
— boredapebot (@boredapebot) May 15, 2022
Bored Apes Yacht Club (BAYC) is one of the most famous and expensive NFT collections, with the average floor price of each NFT sitting at 101 ETH ($205,000) at the time of writing.
Despite this, Bored Ape #6462 ranks as the rarest 209 NFT in the entire 10,000 BAYC collection. He comes with a mix of the rarest BAYC attributes which include pizza, police motorcycle helmet and bone necklace.
And even last May, the same NFT was sold for no less than 2.4 ETH ($7.8,000) just days after it was minted.
Therefore, the unusually low price of Ape with such a rare bottom surprised the crypto community. Some of them offered the version of a fatal error when the seller accepted USDC instead of ETH. Meanwhile, another part of the crypto community suspected that the low value trade was not accidental and implemented in order to evade taxes.
Tax evasion 101. Both accounts have nothing in their wallet, offers accepted Within 3 minutes of signing up
— Jonathan (@Jon_Metavest) May 15, 2022
All Bored Ape NFTs are minted on the blockchain, which is a public, immutable network and all transaction history can be seen.
So, following Opensea records, we can see that Bored Ape #6462 has already been sold 2 times, for 2.14 ETH and 2.4 ETH respectively. Both transactions were made in May 2021. Since then, Bored Ape NFT has migrated between different NFT wallets, but with no money involved.
However, the latest wallet-to-wallet transfer appeared on Sunday, May 15. Just seconds after receiving the Bored Ape NFT, it was sold for an outrageous 200 USDC. The mysterious buyer registered on OpenSea just days before the sale. The unusual activity of the NFT seller and buyer raised suspicions of tax evasion attempts.
The IRS wants to collect taxes on NFTs
In 2021, the NFT market has skyrocketed to become an extremely trending market worth $44 billion. As a result, the United States Internal Revenue Service (IRS) has declared that NFTs could become vehicles for tax avoidance and thus established the rules that every collector of NFTs must report their NFT transactions for tax purposes.
Tax experts have agreed that profits generated from each NFT sold on the open market should be considered ordinary income and taxed at the ordinary income tax rate, which fluctuates between 10% and 37%. The same tax rate applies to fiat and digital currencies.