Cryptocurrencies were conceived as money independent of banks and states. Many market participants are still unwilling to accept regulation, let alone taxes. It is no surprise that debates regularly flare up online about how to avoid these taxes—and what schemes are proposed to do so.

Another wave of discussion unfolded around a question from an X user under the handle Koa.eth: how to cash out a large sum in bitcoin and give nothing to the state. Cryptalist examined the schemes that appeared in the replies and analyzed how workable they are and what their proponents risk.

Tax evasion violates the law. Attempting to replicate such schemes can result in fines and criminal prosecution.

Relocating to another jurisdiction

Most often, relocation is advised. Taxes are paid where a person permanently resides, which means one can choose a country with lenient rules. One participant suggested moving to a place where there is no income tax at all. Others named specific destinations:

  • Portugal, where, according to one commentator, it is enough to wait a year;
  • The Czech Republic, where tax is not levied if coins are held for three years;
  • Switzerland, which was named by two participants at once.

One of them warned: the Switzerland option is legal but cumbersome—it will require finding a job and renting housing. There is another condition: some countries levy a tax on those who leave permanently (exit tax). If such a tax applies in one's home country, the scheme will not work.

A loan secured by bitcoin

The second method is not to sell the coins at all. The owner leaves bitcoin as collateral and borrows money against it. The coins are not sold—therefore, no taxable income arises. The author of the advice added that expenses on such a loan also reduce the tax base.

Exchange for Monero

The third piece of advice is to move into other crypto assets. One user stated that he would exchange all his bitcoin for Monero: in this cryptocurrency, it is not visible who is transferring money to whom. Then, according to him, he bought a crypto card and paid with it directly—no cashing out was needed.

What the schemes mean for users from Russia

Each country has its own rules for cryptocurrencies. What is permitted in Portugal or the Czech Republic may be a violation elsewhere. In Russia, income from the sale of cryptocurrency is subject to personal income tax at a rate of 13–15%. If this is not done, the tax authority will calculate the debt itself and add penalties. A fine will be added to these—20% of the unpaid amount. If deliberate concealment of income is proven, the fine rises to 40%.

For large sums, a criminal case may be opened under Article 198 of the Criminal Code of the Russian Federation. This is possible if over three years a person has failed to pay more than 2.7 million rubles. If the debt exceeds 13.5 million rubles, the court may impose up to three years of imprisonment. Relocation does not solve everything at once either: what matters is how many days a person spent in Russia during the year.

Cryptalist analysis: The popularity of such schemes reflects a fundamental tension between the principles of decentralization and increasing tax control. However, automatic data exchange (CRS) and tightening KYC on centralized platforms make evasion strategies increasingly risky, and Monero's transparency does not guarantee protection when withdrawing funds into fiat. Institutional investors would be wiser to consider legitimate tax planning instruments than to rely on schemes with a growing likelihood of legal consequences.