Important question about NEM project fundraising


#1

we all know nem project have raised some money to kickstart this project
but what is not clear is how Nem project defined the money that was raised at the time

donation ? IPO? ICO?

does NEM developers write an agreement where it clarify this situation?
if you guys have any link don’t hesitate
thank you


#2

When it launched the term ICO didn’t exist. It was called a call to participation.

The first people to register interest got NEM stakes for free. After that it was a small amount, about $15-20 which gradually increased every twenty pages of entries on Bitcointalk.

https://bitcointalk.org/index.php?topic=440185.0

I think in total 63 BTC, when Bitcoin was in the $600 range, was raised and you could also pay in NXT.

Tech Bureau kicked in proper funding for development at some point. Without their money I doubt we’d be talking here now.


#3

so can we classify NEM coin as a security?yes or no?


#4

You should’ve asked that in the first place.

Dunno.

According to the US supreme court a security is an investment contract - "Under the Howey test, an investment contract is “a contract, transaction or scheme whereby a person invests his money in a common enterprise and is led to expect profits solely from the efforts of the promoter or a third party.”

There was no contract and no promise of profits and in the earliest cases no money was paid in return for XEM.

Furthermore - An investment is not considered a security if its profits are based on the actions of the investor. That was one of the intentions originally and stakes were also given out for free to people willing to put in some work.


#5

“…if the coins issued were designed to function as consumer items, intended for use in some context, instead of as an investment, that probably would not fall under the definition of being a security.” [https://www.pymnts.com/news/regulation/2018/cryptocurrency-bitcoin-ethereum-securities/]

ICO/CO/or only O :slight_smile:

Complicated question to answer GIVEN that one believes what was being said in public forums, under anon accounts , about Nem offerings. One would actually need to see books (if any) from day one in order to asses cash flow.


#6

based on what you said are we entitled to pay tax in case we sell
should we declare it to the tax office or xem is just like fidelity point reward


#7

That totally depends on what jurisdiction you live in. It has monetary value so it’s absolutely taxable if you sell it in many places.

I live in the UK. If I sold XEM above my capital gains allowance I’d pay 20% tax on the profit.

Being a security has nothing to with whether it’s taxable. Bitcoin explicitly is not a security. It’s taxed in just the same way in most places.


#8

but why some NEM developer insiste the distributed stake where a donation from nem project to the stakeholder
and the fund that was raised also a donation from supporter to the project

in this case if that is true the original stake holder received a donation stake which is not taxable
am i wrong?


#9

It doesn’t matter how you obtained it. It’s worth something, you own it and you’re selling it. It would be no different from stocks I inherited.

The reason they’re talking that way about donations, not actual payments, is because the securities question is a potential problem for the creators of the fundraising and exchanges looking to list them. It’s nothing to do with the subsequent owners or their taxation.

The fundraisers could be retroactively prosecuted for operating a security without approval which is why they used such woolly terms.


#10

according to this the distributed stake were free .
nobody bought a stake in the sense of buy and sell
everything was free but if you came too late u have to pay a small fee .


#11

There are two questions and I’m not totally sure which one you’re asking.

Is it that you believe it’s tax free because it was technically free initially?


#12

Hey man, if you receive a gift for example a new car and after while you sell it for profit
for example 20000$ are you liable of taxes?!
Maybe a car is not the right item to compare here because you get taxed also on owning a car
but anyway what do you think are you liable of taxes or not when you sell it?!

Tax is applied on your profits(gains) depending on your jurisdiction.
Probably you have income tax , capital gains tax, etc… in your country.
And is not bitcoin or xem that are taxed but your FIAT earnings unless there is a special law in your country.


#13

If I exchange XEM for another crypto I’m liable for the equivalent in fiat in tax if I’d made a gain in the value of XEM that I’m paying with. Same goes in the US now.


#14

Yeah , exactly what I said. There is a law in this case in UK and USA.
Not all the countries have the same laws some of them don’t even have capital gains taxes.


#15

up the the country where you live i know in france if somebody gave you a donation you have to declare it and pay tax on it if the value more then 10 k or something like that no matter from where the donation come from or who gave it to you.

belgium in the other hand they don’t tax donation only if it is a real estate

so up to the country where u live
just tap on google . i have received a donation + tax + country . you will find enough resources