fc-updates

Technowatermelon. Elder Millenial. Building Farcaster. 

nf.td/varun

I also want to clarify a few things about how fees work: 

1. Clanker protocol earns fees in both WETH and project tokens. We only convert the WETH to buy more $CLANKER as of now. 

2. A third of fees are reserved for taxes. 

3. Using 1% of all $CLANKER trading volume is not a good proxy for fees earned by the protoco

“Why isn’t it just 1% of all volume?”

To get more specific:

v0 through v3.1 Clankers: fees in WETH and native tokens. We haven’t sold any of the native tokens yet but likely will. 

v4: fees in WETH. This has been swapped into Clanker. 

LP position: fees in WETH and Clanker. We keep the Clanker and then swap the WETH for more Clanker.

Additionally, fees are not generated in pools on Aerodrome or centralized exchanges like Coinbase.

What if there was a 2 - 5 year sell delay for pre-v4 native token fees to mitigate sell pressure? The assumption being that any tokens still alive will by then be able to handle it. Otherwise this could hurt small projects.

Tortoise Token

It’s taxable income for us now. If token goes down massively, we have to pay the taxes regardless. 

We’re still evaluating a few options.

leader • reader • taco eater • fly eagles fly • /whiskey • /nativefun • onchain chef • previously addepar, linkedin

yeah, the reality is it'll be easiest to do whatever is simplest for financial compliance

a burn would basically book the fees as income to the protocol, without actually receiving anything of value (i.e. no cashflow)

potentially, they can return it to clanker creators earmarked for community rewards, and book it as 

it's worth exploring how you can offset the taxable income by distributing project tokens as a marketing expense for farcaster apptokens

right, that is the problem

it's cool how deel does this through an *employer of record* but i don't think an off-the-shelf (and simple) solution for this exists in crypto 

it's cool to see you're exploring and open to different approaches, maybe a good solution will emerge over time

i'll keep thinking about it, too

https://www.deel.com/glossary/employer-of-record/

it's worth exploring how you can offset the taxable income by distributing project tokens as a marketing expense for farcaster apptokens

https://farcaster.xyz/jrf/0x21d71de8

ideally not, otherwise you end up in the same place I think

xfr'ing to non-profit gets the tokens off your books and removes the associated taxes (possible even to set it up onchain such that the tokens never land on your books at all)

then non-profit can sit on the tokens and distribute them out to contributors in conjunction with the token creator/org, or just adds liquidity, or something idk. I suppose if you're just going to return or burn the tokens then you don't even need the non-profit though

anecdotally, plenty of crypto people do kyc/kyb for e.g. op rpgf. Plus the limit next year goes up to 2k

if you burn, can you expense the cap loss & residual value?

there also might be a way to ~donate them as a tax write-off to a non-profit with the goal of furthering the interests of each project, or something

@listen2mm.eth tipped Bloom Drift | NEONCHAIN Summer Series (Blueprint) to @dwr!

10 artworks left to tip

Developer/Builder.
Snob.
Fren.
Hodler.
Based mmfer.

We do some music enjoying. We shoot some hoops. We degen with the homies.

probably naive but is there a way to offer the native tokens OTC to the app founder, perhaps at a small discount, so you can collect funds to pay taxes, potentially with a tax loss harvesting benefit, without directly affecting token price?

🎡