Musician Jonathan Mann earned $3 million by selling NFTs, but lost nearly all of it due to taxes and the market crash

ChainCatcher news, according to Cointelegraph, musician Jonathan Mann nearly lost all his funds after earning $3 million through NFT sales due to the cryptocurrency market crash and tax issues. He turned this experience into a song to warn crypto investors about tax risks.

In January 2022, Mann sold 3,700 songs as NFTs at a price of $800 each, earning about $3 million in ETH. Due to not cashing out in time and the drop in ETH prices, he faced a requirement from the IRS to pay taxes on the full income, amounting to $1.095 million. To offset the taxes, he collateralized his ETH to borrow through Aave, but lost 300 ETH in a chain liquidation triggered by the collapse of the Terra ecosystem. Ultimately, he was forced to sell an Autoglyph NFT he had purchased earlier for $1.1 million to pay the taxes. Mann stated that despite the heavy blow, he continues to create and release NFT songs daily, hoping to achieve success again.