No choice but to sell off bitcoin or ether to pay the taxman in 2018? The Sweetbridge Liquidity App offers a way to simultaneously HODL and extract liquidity from crypto-assets to pay your tax billIt’s finally Tax Day 2018 — the day of reckoning where crypto investors, HODLers and traders in the United States must face the reality that the government is entitled to a cut of their gains from bitcoin, bitcoin cash, ether and other cryptocurrencies that exploded in value during the second half of last year.Photo credit: Wikimedia CommonsDid you buy a cup of coffee or a pizza with bitcoin in 2017? Did you cash out at the top of the market in late December? Did you earn block rewards from mining bitcoin, ethereum or other currencies? Uncle Sam says those are all taxable events that are subject to capital gains taxes.The United Kingdom similarly treats cryptocurrencies as property that is subject to capital gains taxes.Did you receive bitcoin cash last August when the bitcoin blockchain hard forked? That’s probably a taxable event as well (at least in the U.S.), though there’s no clear guidance on this and other important scenarios, which has created no small amount of confusion and frustration.This grim state of play has been nicely chronicled in a special “Crypto and Taxes” series by CoinDesk, the leading crypto and blockchain industry publication. The running theme is that with investors realizing 1000x returns across the crypto scene in 2017, there is no more running away, burying your head in the sand, feigning ignorance when it comes to reporting crypto gains to the government. With the Internal Revenue Service now partnering with blockchain analytics companies to hunt for tax cheats, playing by the rules is probably a wise idea.Indeed, traders seem to be taking heed of that message. The prevailing theory for why the crypto markets have been down recently is that people are selling off bitcoin and ether for dollars so they can pay the IRS.But for diehard HODLers, selling off bitcoin at $7,000 just months after it nearly hit $20,000 must feel something akin to trading away Giancarlo Stanton for Starlin Castro, especially if the price begins to surge once tax season is over.Sweetbridge Liquidity App to the RescueWouldn’t it be great if there existed a way to simultaneously HODL your bitcoins while extracting the necessary liquidity out them to pay off your tax bill?That’s one of the great potential use cases of the Sweetbridge Liquidity Application, which will allow users to place crypto-assets into an asset vault and withdraw money against them in the form of Bridgecoin. This fiat-stable currency can then be used for various purposes, such as converting to US dollars or other fiat currency to pay off a tax liability.For Sweetbridge members that hold and activate sufficient Sweetcoin, this loan to yourself against crypto holdings will be originated at an interest rate of zero percent and can be paid back on the user’s own terms. The only rule is that the value of the assets in the vault must remain high enough to meet the collateral requirements which are set by our economics team.Best of all, the user still maintains ownership of the underlying crypto-asset and is entitled to any capital gains that accrue during the lifespan of the loan.While Tax Day 2018 may be a morbid and painful one for crypto-investors, the Sweetbridge Liquidity App figures to make this necessary evil more simple, more economical and more easy to stomach in the years ahead.About SweetbridgeSweetbridge is a new economy built for commerce that enhances the world’s current economies. Sweetbridge and its alliance partners offer a unique set of blockchain protocols, applications and crypto-economics to create an economy of opportunity for all participants. The goal of Sweetbridge is to transform brittle, industrial-era commerce through decentralized industry ecosystems that create a faster, fairer value exchange, unleash working capital, better utilize resources, and optimize talent for the benefit of all participants. For more information, follow Sweetbridge on Twitter at @sweetbridgeinc or visit https://sweetbridge.com.Crypto Tax Day Got You Down? There’s an App for That was originally published in Sweetbridge on Medium, where people are continuing the conversation by highlighting and responding to this story.