Who accepts Shiba Inu as payment? Shiba Inu AMC


Shiba Inu Payments for AMC Movie Tickets Could Be a Tax Mess

SHIB Inu being accepted by AMC could give the crypto a boost

  • AMC Entertainment now accepts Shiba Inu (SHIB-USD) and Dogecoin (DOGE-USD) (NYSE:AMC).
  • This could help both of these meme crypto coins, particularly Shiba Inu, which is less well-known than Dogecoin.
  • SHIB coin is up dramatically as a result of this announcement, which could trigger a cryptocurrency comeback in the future, although the tax implications of utilizing Shiba Inu can be complicated.

On March 10, Shiba Inu investors received some very positive news from AMC CEO Adam Aron. He tweeted that Shiba Inu and Dogecoin can be used to pay for AMC movies in theaters online.

This occurred a week early than anticipated. According to Cryptopotato magazine, the event was originally scheduled for March 19.

This is a watershed moment for meme coin investors because it represents the first time that a significant consumer retail company has agreed to accept both crypto currency as payment. Furthermore, because Shiba Inu is not as well recognized as Dogecoin, it may bring additional exposure for SHIB crypto to many investors.

On the other hand, it could also get quite complicated from an accounting and tax standpoint. This article will look into an example.

What This Means for Investors

Shiba Inu has begun to recover as a result of this news. The token price on Saturday, March 19, was 0.00002454. Yes, there are four zeros to the right of the decimal. Another way to look at it is this: Before transaction costs, $10,000 will get you 4,074,980 SHIB tokens.

The simplest method to do this is to use Coinbase Global's (NASDAQ:COIN) platform, which now supports Shiba Inu trading. The price is rounded up to $0.000025 as of March 19. That means you could buy 4,000,000 SHIB tokens for $100 (at the price on March 19th). However, Coinbase charges a fee, so the total amount you'd receive is only 3,909,573 tokens (plus some decimal points).

This demonstrates that Coinbase deducts 2.265 percent of your transaction. So, for $100, you get $97.73 worth of SHIB cryptocurrency.

That may seem like a lot, but it is routine procedure for crypto transactions these days. Nothing comes cheap.

Furthermore, in my experience, this is significantly less expensive than the previous situation in which you could buy Shiba Inu on Coinbase. Previously, you had to first purchase an intermediary cryptocurrency, such as Tether (USDT-USD). The USDT tokens would then be converted or exchanged for SHIB tokens. Both of these transactions had costs, and the net amount was usually greater than the 2.265 percent fee that Coinbase did not charge.

So, who would want to pay for movies with Shiba Inu tokens? For most millennials, the choice is straightforward. It's like paying for a movie with money that doesn't feel like money. Holders believe the movie payout is like "playing with house money" because they expect Shiba Inu to rise in value or because they may already have a large gain in Shiba Inu.

Is that correct? Let's take a closer look at the fine print.

Why Using Shiba Inu for Payment Is Complicated

The issue with this scenario is that financial accounting for cryptocurrency payments is somewhat hard. When you pay for a transaction with SHIB crypto, you are effectively selling it at a price. You will be required to pay a capital tax.

The cost is the cost of a movie ticket. As a result, when you cash in any number of Shiba Inu tokens to pay for anything, you must account for any capital gains or losses.

Assume you spent $100 on average for 3.909 million Shib tokens. This was when the price was $0.000025, but owing to fees, your current average cost is $0.000025582. The first problem is determining your true average cost per token.

Figuring Your True Cost Using Shiba Inu for Payments

Second, you must calculate the transaction's cost. Assume that the $15 price now costs 500,000 SHIB tokens. This suggests that the ticket was purchased at a cost of $0.000030 per SHIB token. This is demonstrated by dividing $15.00 by 500,000, yielding $0.000030.

This indicates we've "booked" a capital gain ranging from $0.000030 to $0.000004418. (i.e., 5 zeros to the right, not 4). The redemption of 500,000 tokens resulted in a $2.21 capital gain (i.e., 0.000004418 x 500,000 = $2.21). You will have to pay taxes on that at a rate of, say, 20%. (depending on whether you held the tokens one year or longer). This brings the transaction cost to 44 cents (i.e., 20% x $2.21). If you have 100 transactions in a year like this your capital gains tax accrued will be $44.18.

In essence, you'll need to keep a precise spreadsheet of this and figure out your implied gains and losses every time you buy something. Losses might sometimes wash out gains, but you'll almost certainly have to itemize all of these computations as itemized deductions on your taxes. That is also inconvenient.

Can Things Be Simplified?

One way around this is to keep your SHIB crypto assets in a tax-free account, such as an IRA. But there are concerns with that as well. Is it possible to buy movie tickets in an IRA?

As you can see, as long as you are prepared, utilizing cryptocurrency to pay for items could be beneficial to Shiba Inus. On the other side, your accounting, tax, and time spent studying the transactions may be costly.

Remember, this is not tax or financial advice. Before you begin spending cryptos for payments, you must first speak with your account.


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