5 ms·

Can someone with a bit more background or understanding give me an ELI5 as to what Wright is doing / gets from this? I'm assuming the 1.1m bitcoin refers to wha

by iamben 5y ago

Can someone with a bit more background or understanding give me an ELI5 as to what Wright is doing / gets from this? I'm assuming the 1.1m bitcoin refers to whatever Satoshi was meant to have mined? Which I assumed was 'lost'? Not really a crypto person, just very curious and the article is lacking detail! Thanks!

thebean11 5y ago
My understanding is that he's claiming he lost billions of dollars in Bitcoin to get a massive tax deduction. Most people think he's lying.
- AustinDev 5y ago
  That's not how this would work... I lost ~1,000 BTC and ~10,000 LTC in ~2011. I couldn't write it off at even the current value at the time if I wanted to write it off I would have to write it off at my cost basis which is the value when I mined them which was barely 50 dollars iirc. That's what my tax guy said at least if this is wrong let me know because I won't ever be paying capital gains tax again if I can write it off at current value.
  - cosmojg 5y ago
    > I won't ever be paying capital gains tax again if I can write it off at current value. I'm in a similar boat. I honestly can't wait until the tax rules around cryptocurrencies are finally fully hashed out, clarified, and published.
  - 3np 5y ago
    CW is not a US tax resident afaik
  - nullc 5y ago
    Wright's past tax scam is a bit more subtle than what you and (probably) the prior poster imagine. AU has a program where if you spend money on R&D you can get a refundable tax credit-- not just a deduction, but like EITC in the US they'll actually cut you a check. Wright spun up a collection of companies that engaged in no business (or research) except claiming these tax credits. According to his own companies documentation, all in all he claimed to have performed $200m in research and requested $65m in credits. The first year he attempted this he did it with smaller values and they paid out, but in later years he tripped audit alarm bells. The AU tax office immediately started asking where he got the $200 million that he claims he spent on research. This is the origin of Wright claiming to have invented Bitcoin: he claimed he had some enormous trove of bitcoin's held overseas and that his companies were funded by taking out loans against them. Wright made a massive amount of forgeries to support his claims across a couple years of fighting with the ATO. The tax office thoroughly debunked and discredited wright's lies and forgeries and found against him, ordering him to repay the money. At that point Wright took the show on the road, literally: He fled AU while the police were raiding his offices, and started selling shares of his fictional fortune and fictional intellectual property to others in order to cover the AU clawback and finance his lifestyle. Since then his life has been a series of forced moves, lie after lie in a growing snowball to delay the collapse of his con. For example, for a while he held off his "investors" (victims) by claiming that the Bitcoins were in trust and would be delivered by a bonded courier in Jan 2020 (like that scene in back to the future 2) -- but after that date came and went he claimed that the coins were delivered by were stolen from him by hackers that hid a wifi pineapple in his home and that now he's going to get them back by suing Bitcoin developers to backdoor the system to return them to him.
    - iamben 5y ago
      Thank you! This is going to make a great movie at some point :-)
  - asdfasgasdgasdg 5y ago
    Yeah the cost basis analysis sounds correct. You have to realize gains, and pay taxes on them, before subsequent losses would be deductible. (Or else you have to start from a higher basis and lose money, and realize those losses.) This works the same with traditional financial instruments.
- deleted 5y ago
  [deleted]
- RL_Quine 5y ago
  Not reduction, a cash incentive payout for "research".
renewiltord 5y ago
> In a case that was promptly labelled "bogus" by one defendant, Craig Wright is demanding that developers allow him to retrieve around 111,000 bitcoin held at two digital addresses that he does not have private keys for. https://www.reuters.com/world/uk/london-court-allows-australias-wright-serve-bitcoin-copyright-claim-2021-04-22/ https://www.reuters.com/world/uk/london-court-allows-austral... In a related case, he's trying to get them to 'give' him the Bitcoin he doesn't have a key for. Weird sort of thing. It sounds unlikely that any fork that permits this would have any sort of support. EDIT: Never mind, here's the actual case https://casetext.com/case/kleiman-v-wright-14 https://casetext.com/case/kleiman-v-wright-14 I read part of it but it looks like they mined a huge bunch of BTC and put it in a trust and the Kleiman side argued that Wright impersonated him (in some way, didn't read too deep) to transfer that to himself. If this is right, this guy is rich as fuck. Sounds weird for him to be suing the bitcoin devs to get a tenth as much through a hard fork so one can assume he fucked something up along the way and lost the keys to that stuff. It's like 1.1 million BTC (50 billion USD at current price) right now. That's wild.
- iamben 5y ago
  Thanks! So what's the logic behind it? I mean - he must be able to see that it's a non-starter?
  - nullc 5y ago
    Wright finances his activities and lifestyle by getting loans secured by promises of future delivery of this fictional trove. As long as he keeps the con going the money keeps flowing.
gkoberger 5y ago
In this situation, if he had lost, he would have owed his "business partner" half of the 1.1m BTC. Since he's not Satoshi and doesn't have access to billions of dollars, losing this trial would have meant he owed tons of money he didn't actually have.
ice_futures 5y ago
He is using the legal system to claim Satoshis coins. And also extract royalties from anyone using the "Bitcoin database" which he claims he owns the copyright to (the code has an MIT license). He and his loser friend Calvin Ayre (a washed up 90s dot com online gambling exit billionaire) are pushing "Bitcoin SV" as the real Bitcoin. It is both tragic and pathetic.

by iamben 5y ago

thebean11 5y ago

My understanding is that he's claiming he lost billions of dollars in Bitcoin to get a massive tax deduction. Most people think he's lying.

AustinDev 5y ago
That's not how this would work... I lost ~1,000 BTC and ~10,000 LTC in ~2011. I couldn't write it off at even the current value at the time if I wanted to write it off I would have to write it off at my cost basis which is the value when I mined them which was barely 50 dollars iirc. That's what my tax guy said at least if this is wrong let me know because I won't ever be paying capital gains tax again if I can write it off at current value.
- cosmojg 5y ago
  > I won't ever be paying capital gains tax again if I can write it off at current value. I'm in a similar boat. I honestly can't wait until the tax rules around cryptocurrencies are finally fully hashed out, clarified, and published.
- 3np 5y ago
  CW is not a US tax resident afaik
- nullc 5y ago
  Wright's past tax scam is a bit more subtle than what you and (probably) the prior poster imagine. AU has a program where if you spend money on R&D you can get a refundable tax credit-- not just a deduction, but like EITC in the US they'll actually cut you a check. Wright spun up a collection of companies that engaged in no business (or research) except claiming these tax credits. According to his own companies documentation, all in all he claimed to have performed $200m in research and requested $65m in credits. The first year he attempted this he did it with smaller values and they paid out, but in later years he tripped audit alarm bells. The AU tax office immediately started asking where he got the $200 million that he claims he spent on research. This is the origin of Wright claiming to have invented Bitcoin: he claimed he had some enormous trove of bitcoin's held overseas and that his companies were funded by taking out loans against them. Wright made a massive amount of forgeries to support his claims across a couple years of fighting with the ATO. The tax office thoroughly debunked and discredited wright's lies and forgeries and found against him, ordering him to repay the money. At that point Wright took the show on the road, literally: He fled AU while the police were raiding his offices, and started selling shares of his fictional fortune and fictional intellectual property to others in order to cover the AU clawback and finance his lifestyle. Since then his life has been a series of forced moves, lie after lie in a growing snowball to delay the collapse of his con. For example, for a while he held off his "investors" (victims) by claiming that the Bitcoins were in trust and would be delivered by a bonded courier in Jan 2020 (like that scene in back to the future 2) -- but after that date came and went he claimed that the coins were delivered by were stolen from him by hackers that hid a wifi pineapple in his home and that now he's going to get them back by suing Bitcoin developers to backdoor the system to return them to him.
  - iamben 5y ago
    Thank you! This is going to make a great movie at some point :-)
- asdfasgasdgasdg 5y ago
  Yeah the cost basis analysis sounds correct. You have to realize gains, and pay taxes on them, before subsequent losses would be deductible. (Or else you have to start from a higher basis and lose money, and realize those losses.) This works the same with traditional financial instruments.
deleted 5y ago
[deleted]
RL_Quine 5y ago
Not reduction, a cash incentive payout for "research".

renewiltord 5y ago

> In a case that was promptly labelled "bogus" by one defendant, Craig Wright is demanding that developers allow him to retrieve around 111,000 bitcoin held at two digital addresses that he does not have private keys for. https://www.reuters.com/world/uk/london-court-allows-australias-wright-serve-bitcoin-copyright-claim-2021-04-22/ https://www.reuters.com/world/uk/london-court-allows-austral... In a related case, he's trying to get them to 'give' him the Bitcoin he doesn't have a key for. Weird sort of thing. It sounds unlikely that any fork that permits this would have any sort of support. EDIT: Never mind, here's the actual case https://casetext.com/case/kleiman-v-wright-14 https://casetext.com/case/kleiman-v-wright-14 I read part of it but it looks like they mined a huge bunch of BTC and put it in a trust and the Kleiman side argued that Wright impersonated him (in some way, didn't read too deep) to transfer that to himself. If this is right, this guy is rich as fuck. Sounds weird for him to be suing the bitcoin devs to get a tenth as much through a hard fork so one can assume he fucked something up along the way and lost the keys to that stuff. It's like 1.1 million BTC (50 billion USD at current price) right now. That's wild.

iamben 5y ago
Thanks! So what's the logic behind it? I mean - he must be able to see that it's a non-starter?
- nullc 5y ago
  Wright finances his activities and lifestyle by getting loans secured by promises of future delivery of this fictional trove. As long as he keeps the con going the money keeps flowing.

gkoberger 5y ago

In this situation, if he had lost, he would have owed his "business partner" half of the 1.1m BTC. Since he's not Satoshi and doesn't have access to billions of dollars, losing this trial would have meant he owed tons of money he didn't actually have.

ice_futures 5y ago

He is using the legal system to claim Satoshis coins. And also extract royalties from anyone using the "Bitcoin database" which he claims he owns the copyright to (the code has an MIT license). He and his loser friend Calvin Ayre (a washed up 90s dot com online gambling exit billionaire) are pushing "Bitcoin SV" as the real Bitcoin. It is both tragic and pathetic.