The Non-Realization Framework: How On-Chain Operations Stay Outside Disposition
Non-realization is the principle that some on-chain operations — collateralization, wrapping, intra-protocol transfers — are not disposal events under common interpretations of major-jurisdiction tax law. Here is the framework principals use.
On-chain operations that are not realization events under common tax interpretations
Wrapping, bridging, intra-protocol transfers, and pure collateralization generally fall outside disposition under common interpretations of major-jurisdiction tax law. Counsel still drafts the memo.
Why collateralizing your stocks is not a sale (and what the IRS thinks)
Pledging shares as loan collateral does not trigger a capital gain. The asset stays on your balance sheet, the loan is not income, and the structure is well-documented in published guidance.