The Tax Treatment of Tokens: What Does it Betoken?
19 Pages Posted: 24 Oct 2017
Date Written: August 3, 2017
Digital tokens have been used to raise substantial amounts of money. But little attention has been paid to the tax consequences surrounding their issuance and sale. There are significant potential tax liabilities lurking in the use of digital tokens. But, because of the anonymity inherent in the blockchain structures used for the issuance of tokens and payments for them, there is a significant question as to whether those tax liabilities will ever be collected.
Keywords: Taxation, securities, corporate finance, digital tokens, bitcoins, block chain, e-commerce, bearer instruments, virtual currencies, taxation, DAO token, tax treatment of tokens, tokens as equity, issuer obligations
JEL Classification: H26, K22, K34
Suggested Citation: Suggested Citation