Are cross-chain bridge transactions taxable events for my foreign-owned LLC?
My LLC bridges ETH from Ethereum to Arbitrum and Optimism to take advantage of lower gas fees for DeFi. I also bridge USDC between chains. When I bridge, I send ETH on one chain and receive wrapped ETH (or native ETH) on the destination chain.
Is bridging a taxable event? I'm not selling the ETH — I'm just moving it to a different network. But technically I'm sending one token and receiving a different one. What's the IRS position on this?
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