Game Theory Group

The Blockchain Brief

50 Cent Forgot He Owned Bitcoins Then Remembered Then Forgot Again

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The 50 Cent Bitcoin story is legendary, and encompasses so much about crypto-culture that it's worth dissecting. 

Here is the timeline:

  • June 2014: In a Reddit AMA for his album release, 50 Cent said that he accepted about $450,000 in Bitcoin in lieu of cash for his album. Bitcoin is valued at bout $620.
     
  • June 2014 to Jan 2017: Bitcoin rises in price from $620 to over $10,000
     
  • Jan 2017: 50 Cent posts on Instagram and Twitter (since deleted). Note how his Instagram post does not mention any discrepancies with the story.
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  • Feb 2, 2018: 50 Cent, under oath, claims that all of the Bitcoin he earned was immediately converted to fiat $. Claims that the reason he didn't deny the post was because it made him look good.

This story is intriguing on many levels. Regardless of whether or not 50 Cent immediately liquidated his holdings and only received thousands for them - as he claims - we're going to dive into a couple of things everyone should be aware of when discussing cryptocurrency holdings publicly.

The Dumb Move

Lending first-person credibility to a claim that you hold massive amount of Bitcoin. On Twitter and Instagram. Why is this bad?

  • Whether or not you have direct access to your Bitcoin, you can get kidnapped. This has happened, and will happen again and again to those that criminals believe can give them access to cryptocurrency. Even if you aren't 50 Cent, you're really not that hard to find.
     
  • The IRS has mentioned multiple times that it is underfunded. That means it will struggle to go after everyone that is possibly avoiding taxes. But going after a figure publicly claiming to be a crypto millionaire? This they can do.

The Dumb(er) Move

  • Bitcoin is not private. The IRS, the FBI and many other agencies are already tracing back wallets to criminal activity. Remember, this is a public ledger. Figuring out the origin of Bitcoin transactions is basically like playing a really complicated game of Sodoku. But with computers way smarter than you are.
     
  • So don't lie about Bitcoin in Bankruptcy court.

The Dumbest Move

  • He took cash for Bitcoin in 2014! LOL.
     
  • What are the chances that the intermediary collecting Bitcoin on 50 Cent's behalf actually sold their Bitcoin at the same time that they cashed him out for "only thousands".
     
  • Did they pay the IRS? The real story is with them.
Boris Revsin