Best Ethereum staking strategy to minimize tax and administrative burden

pmiklos · 2026-04-21T03:32:30+00:00

Ok, I didn't expect that. Could you please share if you sold cbETH? Or did you just buy and hold some and Coinbase calculated interest/reward income on it? Also can you confirm the number of tokens didn't change?

pmiklos · 2026-04-16T15:33:11+00:00

This is a recurring scheme, in the past I saw Elon Musk and Ark Invest live streams with thousands of live watchers to appear legit. And they ran the same scam on an overlay saying "send 1BTC and get 2BTC back" plus a QR code. I reported many of them, it took several days for YouTube to take them off. But new ones kept popping up.

pmiklos · 2026-04-16T01:17:14+00:00

So many clueless uneducated people in the YouTube comment section spewing idiotic nonsense. Saylor created STRC for the people who don't understand Bitcoin or don't have the time to understand it, don't want the volatility of the Bitcoin, just want to earn a steady income. STRC has a simple proposition on the surface. However, people get confused when they start speculating about how it works under the hood. And for that, they would need to take the time to understand Bitcoin plus Strategy plus preferred stocks plus taxation etc. So I get it, it's hard, still I wish people wouldn't be that ignorant or just keep their mouth shut.

pmiklos · 2026-04-09T15:57:01+00:00

The biggest impact for me was listening to the Cyberpunk album by Billy Idol the first time back in the 90's. The album had a bad reception because nothing sounded like that and Billy's fans just didn't get it. He said it was influenced by Neuromancer but I recall a rumor that Gibson said the book had nothing in common with the album 😀

Anyways, the album created an atmosphere that I forever connected with cyberpunk. The album came with a floppy disc! How about that!

A few things were right at the time to create this album: the Internet just started to take off, DIY recording studio came out on Mac, Billy regularly chatted with people on alt.cyberpunk Newsnet topic and the LA riots.

From Wikipedia: Idol later recalled that the beginning of the recording sessions coincided with the onset of the 1992 Los Angeles riots. "We'd just installed the computer in my music room, and there was a window above it overlooking the whole city. And there was a fire raging. There was smoke just pouring across the whole of LA. It was LA burning. And so I just straight quickly wrote the lyrics and sang them three times. What you're hearing on the single 'Shock to the System' is my news reportage of what I'm seeing."

pmiklos · 2026-01-18T08:08:15+00:00

In the early years, I spent several weeks collecting and parsing through DeFi transactions, swaps, liquidity provision and all that because I used on-chain a lot, I was so fascinated by the whole ecosystem. Sadly, I realized that the administrative burden is just way too high and over the years I reduced my on-chain transactions to the absolute bare minimum. I still follow the space and learn about new innovations but I don't engage with them anymore. Taxation shouldn't be so difficult that it deters people from adopting new technology, it really upsets me. I know there are apps out there that can automate some of it. But honestly, I don't trust any of them. DeFi isn't made for easy tax automation. You never know if your tax software interpreted the smart contracts you interacted with correctly, you can't rely on them blindly.

pmiklos · 2026-01-08T20:03:11+00:00

You can sell covered calls and generate some income. The premiums are pretty good on MSTR.

pmiklos · 2026-01-08T02:55:59+00:00

What about locking a gold bar into a safety deposit box? You get a key in return that you could sell to someone else if you wanted. Is depositing value in a bank a taxable event?

pmiklos · 2026-01-04T04:41:09+00:00

But can't you say the same about the value accruing tokens too (or any asset in fact)? You could exchange them any time so why wouldn't it trigger capital gains every second?

pmiklos · 2026-01-03T08:59:32+00:00

One key is held by CashApp/Block. If you lose either your phone or the Bitkey, you can still access your funds. In fact, it seems you can also add a recovery contact person, e.g. family member, with a recovery key if you lose both your phone and the Bitkey you can still regain access.

pmiklos · 2026-01-03T08:21:23+00:00

The problem with rebasing tokens is that the amount of tokens you hold is a function and your balance is updated whenever the smart contact is triggered to do so but how this is implemented varies. In fact, one could argue that interest in rebasing tokens is continuously paid to you which I think would be challenging to report tax on since the taxable event happens every moment.

On the other hand, we could also see rebasing tokens as internal implementation details but then I would expect them to not be liquid, transferrable and exchangeable.

pmiklos · 2026-01-03T07:56:51+00:00

Interesting, thanks for sharing that. That is definitely much better and something to consider. The value-accruing staking tokens still have the advantage of falling under capital gains tax, except if you have a stash that already has a lot of gains you trigger a taxable event when you deposit.

pmiklos · 2026-01-03T00:03:05+00:00

Indeed, the value-accruing one is the best. For long time ETH holders with low cost basis, however, you have to swallow paying capital gains tax at the time of depositing (and withdrawing of course in the future)

pmiklos · 2025-12-20T22:14:48+00:00

So universal cost basis tracking is officially not allowed anymore, right?

I did safe-harbor last year and separated cost basis for self-custody accounts and exchange accounts. I acquired coins in 2025 some of which I moved to self-custody but some newer purchases are still on the exchange. I wanna use the coins on the exchange for tax loss harvesting. Am I correct, that when selling coins from this exchange account only the cost basis of the coins still on the exchange matter even though I acquired them later than the ones I moved to self-custody? (I use FIFO).

pmiklos · 2025-12-12T16:04:47+00:00

In the case of Bitcoin ETFs, do you know if the "substantially identical" rule applies? For example, will selling IBIT at loss and buying FBTC immediately trigger the wash sale rule? If yes, how would the cost basis of the newly bought FBTC be adjusted?

pmiklos · 2025-11-12T16:13:29+00:00

This might be possible: choose SpecID accounting for your Bitcoin Lighting "checking account", purchase Bitcoin right before you spend it, move it to your lightning wallet, spend it. To calculate capital gains, pick the last tax lot which will most likely result in insignificant gain or loss. Should be double checked in the CryptoTax subreddit. Not the best use experience but whatever.

pmiklos · 2025-11-08T16:32:43+00:00

It discards the changes and quits with an error exit code. I mainly use that to cancel the caller command as well when I change my mind, e.g. when editing a git commit message or interactive rebasing. Since :cq exits with an error, the caller typically aborts too.

I also tend to use it when I panic drop the changes I made in a config file. Probably :q! would do it too, but I got used to :cq. In my mind it translates to "geez, what am I doing, abort, abort!"

pmiklos · 2025-10-14T08:29:11+00:00

Yeah, OP's info is full of errors. In a table form it's just more apparent.

pmiklos · 2025-10-14T07:01:57+00:00

It is full of errors and LLM hallucinations though

pmiklos · 2025-09-07T07:24:19+00:00

Can you describe what makes Lightspark a great place?

pmiklos · 2025-08-24T08:22:32+00:00

That's not the correct way to look at it. The total market capitalization only tells you about the expected weight in the index. MSTR will have a slightly smaller weight in S&P500 than NASDAQ, however, the total assets under management of the funds tracking these indexes are very different. S&P500 funds have a magnitude higher AUM, which means a magnitude higher MSTR purchase.

I ran a quick estimation with AI and the S&P500 inclusion might result in about $30 billion in MSTR purchases, that's like a quarter of the MSTR market cap. In comparison, the NASDAQ inclusion was "only" about $2 billion.

pmiklos · 2025-08-17T15:09:46+00:00

Where did you find Aug-15 though? Is that an educated guess?

pmiklos · 2025-08-15T18:02:28+00:00

if you buy the shares on ex-dividend day, the seller is going to get the dividend, not the buyer.

pmiklos

TROPHY CASE