A Bunch of Ape NFTs Just Sold For $24.4 Million (theverge.com) 87
If you thought NFT mania was about to die off, think again: a bundle of 101 NFTs from Bored Ape Yacht Club just sold at Sotheby's for $24.4 million. A second bundle of 101 Bored Ape Kennel Club NFTs sold for $1.8 million. From a report: That puts the ape sale among the biggest in the NFT space. A bundle of nine CryptoPunks -- one of the earliest NFT projects -- sold for $16.9 million in May. And Beeple sold a collage of his works as an NFT for $69 million in March. While it's hard to directly compare all of these sales (there are 101 items in today's auctions versus one in Beeple's), the purchases show that the appetite for NFT art isn't dying down, and they suggest that buyers think there'll be high resale value as the market continues to grow.
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I have a big washer and dryer. I can launder money for much cheaper than $1.8 million.
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But my washing machine wants a piece of the action. It takes every other sock.
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But ... how?
Re:Money Laundering (Score:5, Informative)
But ... how?
Let's say you have a big pile of illicit cash.
You want to deposit it to a financial institution so you can buy property or make investments in the legitimate economy. But you can't because the Feds have reporting requirements, and you can't explain where you got the money.
So you run a ruse auction and "sell" an NFT to an accomplice. No money actually changes hands.
Now you can go to the bank and tell them that the money is from an NFT auction. If they don't believe you, tell them to look it up online. It was reported on all the news sites.
In the pre-NFT days, the laundering was often done with physical art. Nobody really thought that Picasso's crap paintings were worth millions.
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Re:Money Laundering (Score:4, Insightful)
I doubt that a bank is going to use a news article as proof of a financial transaction.
They don't need "proof".
They just need something to put down on the form.
It isn't their job to enforce the law. They just file the report.
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Re: Money Laundering (Score:1)
Yeah. you're new at this eh?
The bank is still going to report your large cash deposit. The feds will be notified. They may take an interest and investigate. You'll be on be hook for explaining who you got the money from. Your "friend" will have to do the same. It will not be hard for the feds to piece together the fact that there is a large pile of cash that has no corresponding withdrawal nor a legit cash business from which the cash is derived.
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You'll be on be hook for explaining who you got the money from.
Nope. Financial institutions are required to report cash transactions over $10k. Private citizens are not.
Your "friend" will have to do the same.
Nope. There is no requirement to "explain" anything when purchasing or selling an NFT.
Here's what you say to the Feds: "Talk to my attorney."
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Where are the FTC, SEC and Fed when you need them? It's obvious all this is one big moneylaundering scheme, is it not?!!
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Where are the FTC, SEC, and Fed when you need them?
Lax enforcement means the money moves into the American economy.
Stricter enforcement would push the money overseas.
Neither would affect the number of people using drugs, which is supposedly the "bad thing" the Feds are trying to control.
It's obvious all this is one big money laundering scheme, is it not?!!
Why is that a bad thing?
Would you prefer that the drug dealers go back to physical art? Or car washes and laundromats? Why would that be any better?
If you want to end money laundering, the solution is to legalize drugs.
Who bought them? (Score:1)
Re: Who bought them? (Score:2)
Thatâ(TM)s not how it works, you have to convince at least two wealthy people to keep trying to one up each other for it. So you basically have to get two billionaires to really want the item badly.
Re: Who bought them? (Score:2)
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Well if Andy Warhol can put pictures of cambels soup cans up and hang it in the MOMA in NY, then anything is fucking possible. Can we make an NFT of his damn soup cans?
I saw a print or copy of Warhols cans at the local art museum, I can say I liked it better than I do the soup.
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Actually that’s exactly how it works
Re:Who bought them? (Score:4, Insightful)
Welcome to the world of expensive art. You've got step 1 and 2 down. Shenanigans start with step 3:
3. donate soiled undies to a museum or other charitable organization that can issue you a tax receipt for market value ($1B).
As a bonus:
4. some sucker might actually pay real money for your *other* pieces.
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Salespeople who can sell snow to a snowman.
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Once again this is a tax Dodge (Score:5, Insightful)
So buy a painting for a million, it's suddenly worth 10 million, you donated and write that off on your taxes for the 10 million it's worth, and then you claim a 50% deduction that works out to 5 million in your pocket. If you ever wondered why modern art is so terrible and nonsensical that's why. It's because the people buying it don't care what it looks like.
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Re:Once again this is a tax Dodge (Score:4, Insightful)
Re: Once again this is a tax Dodge (Score:2)
If you want more details on the scam (Score:2)
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I don't think it works like that. If someone paid ten million bucks and can prove it, the auditors have to accept it as an expense. If it was paid using real money, there is no question of the cost, just of the intelligence of the buyer. Value doesn't matter as the rich live in their own reality bubble.
If you paid ten million bucks, the auditors can go straight to the seller and check whether he paid taxes for his profits. If they can't find the seller or something dodgy is going on so no taxes were paid for the profits, then they'll come back to you.
And you need to prove it was actually paid.
Re: Once again this is a tax Dodge (Score:2)
We don't have tax auditors (Score:5, Insightful)
Ironically when they do audit anyone it's a regular middle class person because there are statutory requirements that they do a certain number of audits on low and middle income earners that were baked into old laws by Republicans as part of a compromise by Democrats to get the laws through.
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The IRS has 75,000 employees ( https://en.wikipedia.org/wiki/... [wikipedia.org] ). That is a crazy large number of employees. If they can't do their job with 75k people, adding another 75k people isn't going to change anything.
It's really not that many (Score:3, Insightful)
To add some perspective, Bank of America has 213,000 and they're just one bank in America.
Re:We don't have tax auditors (Score:4, Informative)
The IRS has 75,000 employees ( https://en.wikipedia.org/wiki/... [wikipedia.org] ). That is a crazy large number of employees. If they can't do their job with 75k people, adding another 75k people isn't going to change anything.
https://www.irs.gov/statistics... [irs.gov]
They process 240 million forms and documents, and $3.5 trillion in gross taxes a year. What is an appropriate head count for that scale of operation?
Type of return or form 2020
United States, total [1] 240,160,843
Income taxes, total 189,562,923
C or other corporation [2] 1,819,301
S corporation, Form 1120–S 5,044,303
Partnership, Form 1065 4,470,095
Individual, total [3] 157,195,302
Forms 1040, 1040–A, 1040–EZ, 1040–SR 156,580,123
Forms 1040–C, 1040–NR, 1040NR–EZ, 1040–PR, 1040–SS 615,179
Individual estimated tax, Form 1040–ES 17,579,898
Estate and trust, Form 1041 2,820,317
Estate and trust estimated tax, Form 1041–ES 633,707
Employment taxes [4] 28,028,002
Estate tax [5] 15,023
Gift tax, Form 709 158,095
Excise taxes [6] 902,342
Tax-exempt organizations [7] 1,360,719
Supplemental documents [8] 20,133,739
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Pffft, the USA has 330 million people and the IRS has just 75,000 staff?
Australia has nearly 26 million population and the ATO has around 20,000 staff.
Hmm, those ratios of tax staff per taxpayer seem ... rather different!
Maybe it's due to the focus that the two countries have on people in them actually paying tax?
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Actually that was Newt Gingrich in the Clinton years. He realized that he didn't have to eliminate the EPA, FAA, IRS, etc. if he could just make their enforcement budget a line item, and then squeeze. This is the exact same reason why we ended up with the Boeing 737MAX fiasco, the FAA regulatory budget was cut so much that they no longer have staff who can examine an aircraft and say, "These are too many alterations, this plane needs to be recertified." All they can do is take the manufacturer's word for
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That's why you first sell some work from the same artist in an auction to some rich buddies (or yourself) to establish fair market value.
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So buy a painting for a million, it's suddenly worth 10 million, you donated and write that off on your taxes for the 10 million it's worth, and then you claim a 50% deduction that works out to 5 million in your pocket.
What about capital gains tax? Are you saying they make the $9m profit tax-free?
Googling, I see the US capital gains tax is only 20%, so still a good scam if they pay that.
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You don't have to pay capital gains tax on donations. If you never realized the gain and donate the asset, then you get to deduct the asset's current value and escape taxes on the unrealized gains.
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You don't have to pay capital gains tax on donations. If you never realized the gain and donate the asset, then you get to deduct the asset's current value and escape taxes on the unrealized gains.
Sure, but that requires deducting twice, from income as well as gains. Such a crazy claim requires rigorous citations, which will prove to be mis-read.
Shifting income to capital gains is a good scam, but it does not vanish completely.
Re:Once again this is a tax Dodge (Score:5, Informative)
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This is from Charles Schwab, not some crazy conspiracy theorist:
You can usually deduct the full fair market value of appreciated long-term assets you've held for more than one year, such as stocks, bonds or mutual funds. In addition, if you donate stocks or other investments, you pay no capital gains tax.
Donating investments—especially highly appreciated securities—instead of cash can be a very effective and tax-efficient way to support a charity. Generally, if your assets have appreciated in value, it’s best not to sell securities to generate the cash you need for a donation. Contributing the securities directly to the charity increases the amount of your gift as well as your deduction.
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How does this work? I buy art for $1 million, it's then suddenly valued at $10 million, so I donate it to a charity, and then can avoid paying $3.37 million in taxes (37% short term capital gains) or $2 million (long term capital gains)?
While if I sold the art, I c
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Because no-one would actually pay the 10 mil for it.
The "market value" is anything but.
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NFT (Score:4, Insightful)
Money laundering, alive and well...
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Apparently neither do Slashdot editors ,considering how many stories about NFTs being the next bitcoin are pushed on here.
This is who is buying these (Score:5, Insightful)
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Actually, I didn't see any assumption by the port you replied to as to whether or not the transactions are anonymous. They don't need to be. You deliver drugs to me, I buy an NFT picture of your dog, who cares if the transaction is on a blockchain for everyone to see? Nothing illegal in me buying a picture of your dog.
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Eat the rich. (Score:3)
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Too fatty for my tastes.
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Taste like chicken (allegedly).
Tastes more like pork (Ever heard of long pig?)
Do not ask how I know.
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The Jivaro say we taste like monkey.
Re: Eat the rich. (Score:2)
No humans taste like bacon. That why kees banned pork
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it's all fake (Score:2)
Not News. Not Interesting. Not Important. (Score:1)
Jesus F Christ, no one here gives a shit about NFTs. This is not news. This is not nerdy. Stop posting this useless trash. Just because its on The Verge, doesn't mean it needs to be copy/pasted over to here.
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They care enough to the extent, how can I get in on the gravy train. Even geeks love money.
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Well, these are apparently auto-generated. Sounds like a nice geeky gravy train, selling computer generated art for ridiculous amounts of money.
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This so hard. Nobody is falling for this trash. This proves that rich people are not smart or innovative
Money Laundering (Score:2)
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Transfer large sums of wealth in a transparent in exchange for nothing of value, in a manner that arouses no suspicion
For a manner that arouses no suspicion, it sure seems to be arousing a lot of suspicion!
feather brained (Score:2)
Quality Art (Score:2)
Such great art pieces. For the price, that's a bargain! The pizza one is my favourite.
Artist Viewpoint (Score:2)
In addition to my career in software development, I'm a fine art photographer, and I've minted 2 NFTs -- one on Ethereum, one on Polygon. Neither have sold yet (I won't shill, I'm easy to find lol).
The "cool kids" right now are the big pixel-toon collections, generative art, and digital rendered artwork. But photography (my space) has been getting some attention recently. Photos in the "Twin Flames" collection have been seeing some bonkers prices, but there are plenty of other photographers who are also doi
Apes aren't so bad (Score:2)
If they'd been monkeys, it'd been bananas.
Extended car warranty (Score:1)
Why do we keep getting the fake extended car warranty phone calls?
People like this that have money and are too stupid to know better than to throw it away like this.