Users of Solana lost up to $8 million in cryptocurrency after tens of thousands of wallets were compromised.
Some people’s suffering from this awful incident might be lessened. According to experts, investors from Australia, Canada, and the UK can actually claim a tax loss for having their wallets stolen.
Users of Solana currently have to transfer their money to other, safer places. Given the fact that Solana’s hack’s circumstances are still unknown, the stress is still very real.
How did the Solana cryptocurrency fare?
The internet erupted on July 27, 2022, when about 7,000 cryptocurrency wallets were compromised by as-of-yet unidentified attackers. On their social media, well-known Solana services like Phantom and Slope were among the first to disclose the attack.
The hackers forced access to the clients of Solana’s private keys in order to access their wallets. This made it possible for them to steal victims’ accounts covertly.
The study is moving along, and the causes are becoming clearer.
Right now, consumers should use caution. Scammers are capitalizing on this trend and promising to assist people in getting through this experience. These are con artists trying to take advantage of the situation once more.
Anyone who approaches you and offers you a fix for this issue is taking advantage of you. Transferring the remaining cash to hardware wallets or other locations with higher levels of security is the only option.
The spokesperson for Solana has addressed the issue and stated that every effort is being made to ascertain the motivation behind this breach. Some blockchain specialists believe that hackers may have gained access to private keys by taking advantage of a weakness in the supply chain. This problem appears to be exclusive to IOS.
It is yet unknown whether SOL holders will be able to get their money back.
In addition, SOL appears to have recovered from the hack, as evidenced by a price that was at its lowest from July 26 to July 27, 2022.
SOL’s tax loss declaration is the answer
For those who were impacted by this shocking incident, there is yet hope. According to Shane Brunette, CEO of CryptoTaxCalculator, cryptocurrency lost in a hack may be deductible as a tax loss in certain circumstances and in certain countries.
Shane Brunette informs us about this method for avoiding tax losses:
- This means that the original amount you paid for the asset(s) can be used to offset other capital gains.
Therefore, it offers some hope to the few thousand investors who were suddenly deprived of their investment in a matter of hours.
a potential answer with restrictions
It won’t be possible for everyone to profit from this approach, though. Each country’s laws are unique, therefore it is vital to enquire up front about its particulars to determine whether or not this process can begin.
Australian, Canadian, and UK tax losses
The procedures for declaring a tax loss in each nation are as follows:
- Australia: In Australia, a tax loss may be declared. The Australian Tax Office will require evidence that the missing cryptocurrency belonged to you and was indeed stolen. You must additionally include the dates of private key acquisition and loss in order to demonstrate hacking.
- The processes are a little more difficult to follow in Canada and the UK than in Australia. Affected investors should carefully follow the instructions offered by each nation’s tax authority in order to limit their losses’ tax burden.
United States: Prohibition on Crypto Tax Losses Declaration
Unfortunately, investors based in the United States will not be able to use this service. Investors cannot receive compensation for this kind of loss according to the 2017 tax overhaul.
The latter must then exercise patience in the anticipation that the research will result in the recovery of the lost monies. The study is currently in full swing, and some solutions to the issue are emerging.
Can we claim a loss on our crypto taxes in France?
In France, tax deductions are allowed for cryptocurrency losses. Therefore, if you lost your cryptocurrency during an attack, for example, you might file a tax loss.
You can only make up for your losses with assets of the same kind, though. In other words, you will only be able to use your recovered cash to earn additional crypto gains there if you lose money on cryptocurrencies.
You can still approach bitcoin investments more calmly than in the US thanks to this solution!
