I have a good friend in South Korea. He's been my friend for 15 years and I trust him more than I trust my own family. We even lived together once.
My friend in South Korea is asking me if I'm willing to do Bitcoin arbitrage since the price of Bitcoin in South Korean exchanges is at a 18%+ premium at the moment. However, I'm not sure how I pay tax for the profit since there is no way I can prove how much I made exactly.
Buy Bitcoin in the US.
Send it to my friend's account in South Korea exchange and sell it right away for 18%+ profit. My friend does not have to pay tax for cryptocurrency profit in South Korea.
Convert KRW to USD and send it back to the US.
How do I prove that I made a profit since Bitcoin was sold from my friend's account?
Is this even legal?
Yogita Khatri, Bitcoin is trading near $66,000 in South Korea as 'Kimchi Premium' returns, April 5, 2021.