NFT Trader Could Face Jail for Hiding $13 million CryptoPunk Profits on Tax Return

NFT trader Waylon Wilcox has pleaded guilty to two counts of filing false personal income tax returns, according to the U.S. Attorney's Office for the Central District of Pennsylvania. The trader sold 62 CryptoPunk NFTs in 2021 for a profit of about $7.40 million, followed by 35 CryptoPunk NFTs in 2022 for a profit of $4.90 million. However, Waylon Wilco filed a false FY2021 personal income tax return in April 2022, understating approximately $8.50 million in income tax and approximately $2.10 million in taxes due, and a false FY2022 personal income tax return in October 2023, understating approximately $4.60 million in income tax and nearly $1.10 million in taxes due. Under federal law, the maximum penalty for these crimes is a total of six years in prison, followed by a period of supervised release and a fine.