Glossary
Wrapped token
A token issued on one chain representing an asset held on another, redeemable for the underlying.
Wrapped assets are among the least settled items in digital-asset accounting. There is no generally accepted definition, and standard setters have explicitly returned to the question of whether they fall inside the fair-value regime.
A second question sits underneath: whether wrapping is itself a disposal of the original asset and acquisition of a new one, which would crystallise gain or loss, or a continuation of the same holding. The answer has direct tax consequences.
Where this comes up
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