SNEAK PEEK
- Tax experts reveal that the digital assets lost during an exploit can likely be claimed as a tax loss.
- Solana-hacked crypto can potentially be claimed as a tax loss in regions such as Australia, UK, and Canada, but not in the US.
- This came following the news that over 8,000 Solana wallets have been compromised in a recent exploit in Web3 wallet provider Slope’s network.
This is great news for unlucky crypto investors who lost their assets to the recent Solana hack due to the security breach in Web3 wallet provider Slope’s network, residing in regions like Australia, Canada, and the UK. The lost digital assets can be claimed as a tax loss in these regions, but unfortunately, that’s not the case in the US.
The Solana hack, and it’s possible tax consequences: A thread 🧵 https://t.co/JnYMrkB8qJ
— Crypto Tax Calculator (@CryptoTaxHQ) August 3, 2022
Well, this can undoubtedly be viewed as the much-needed consolidation following the piece of news that over 8,000 wallets have been compromised. The exploit carried out with the breach in Web3 wallet provider Slope’s network accounted for a total loss of around $8 million dollars.
The CEO of Australia-based CryptoTaxCalculator, Shane Brunette, recently released a statement confirming that the lost assets can be declared as a loss for tax purposes, provided that the particular jurisdiction allows that. He said:
This means the original amount you paid for the asset(s) can be used to offset other capital gains.
After the hack, Solana took it to their official Twitter handle to announce that no harm had come to the assets stored in a hardware wallet. Hence, this did advocate for the fact that hardware wallets are immensely safer options than other wallets.
With the introduction of the tax reform in 2017, crypto users in the United States won’t be able to claim the hacked crypto as a tax loss.
This year only, around $2.6 billion in digital assets has been lost to hackers and exploiters alone.
