Depositing DAI into Alchemix lets you withdraw alUSD as a loan that repays itself overtime.
How would I account for this self paid loan ? The repayment is all done by contact with nothing showing in my wallet.
I suspect you can’t as it’s all dynamic and done in-contract. The only tx you can account for is the DAI deposit (sent to pool), deposit of the alUSD loan and then a withdrawal of the original DAI from the pool.
The way I see it, there is no taxable event here, just related transactions and no transactions that can be treated as a gain as such. One could argue that the alUSD withdrawal could be seen as “income”, but it’s technically a loan, which is not a taxable in most countries as far as I know… But hey, I’m not a tax expert.
Either way, I’m keen to know more about how UK’s HMRC will treat this as it’s a great way to use one’s collateral and is something I definitely want to try out.
Hello,
If the “loan” enters your account and you use it to purchase goods and services, that is not a taxable event and it’s seen the same as a fiat loan. If you use it to purchase another crypto then sell it, that is taxable.
“The repayment is all done by contact with nothing showing in my wallet.”
I’m sorry but I don’t understand this part. If you spend crypto to repay any loan in the form of USDC, USDT, etc, that is taxable because it’s a disposal to make the payment. But if the loan “repays itself” without you doing anything and not spending any crypto and magically it’s paid, I don’t see how that can be taxed because there is no disposal taking place.
Kind regards,
Anakin