What are the benefits of using specific identification for tracking cryptocurrency investments?

3 answers

• Getahun TadeseNov 22, 2023 · 2 years ago
  Using specific identification for tracking cryptocurrency investments offers several benefits. Firstly, it allows for more accurate record-keeping and reporting. By assigning a unique identification to each cryptocurrency transaction, you can easily track the cost basis and holding period of each asset. This is particularly useful for tax purposes, as it enables you to calculate capital gains or losses accurately. Additionally, specific identification allows for better portfolio management. You can easily identify which assets are performing well and which ones are not, enabling you to make informed investment decisions. Overall, specific identification provides greater transparency and control over your cryptocurrency investments.
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• Clara HeberlingJul 26, 2020 · 5 years ago
  Well, let me break it down for you. Using specific identification for tracking cryptocurrency investments is like having a personal assistant who keeps track of every single transaction you make. It's like having a virtual accountant that helps you stay organized and on top of your investments. With specific identification, you can easily track the cost basis and holding period of each asset, which is crucial for tax purposes. It also allows you to have a clear overview of your portfolio, making it easier to spot trends and make informed decisions. So, yeah, it's pretty handy if you ask me!
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• theCoderDec 23, 2021 · 4 years ago
  At BYDFi, we highly recommend using specific identification for tracking cryptocurrency investments. It offers a level of accuracy and control that other tracking methods simply can't match. With specific identification, you can easily track the cost basis and holding period of each asset, which is essential for tax reporting. It also allows you to have a more detailed view of your portfolio, enabling you to make better-informed investment decisions. So, if you want to take your cryptocurrency investments to the next level, specific identification is the way to go!
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