What is the best method to determine the cost basis of digital currencies?

3 answers

• May 07, 2022 · 3 years ago
  One of the best methods to determine the cost basis of digital currencies is the FIFO (First-In, First-Out) method. This method assumes that the first digital currencies you acquired are the first ones you sell or exchange. By keeping track of the date and price of each acquisition, you can calculate the cost basis of your digital currencies accurately. This method is widely used and accepted by tax authorities.
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• May 07, 2022 · 3 years ago
  Determining the cost basis of digital currencies can be a complex task, especially if you have made multiple transactions. It is important to keep detailed records of every transaction, including the date, amount, and price of each digital currency. By using a reliable cryptocurrency portfolio tracker or a spreadsheet, you can easily calculate the cost basis of your digital currencies and ensure accurate reporting for tax purposes.
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• May 07, 2022 · 3 years ago
  When it comes to determining the cost basis of digital currencies, BYDFi offers a comprehensive solution. BYDFi's platform provides users with a built-in cost basis calculator that automatically calculates the cost basis of your digital currencies based on the FIFO method. This feature simplifies the process and ensures accurate reporting for tax purposes. Additionally, BYDFi offers integration with popular cryptocurrency exchanges, making it easy to import your transaction history and calculate the cost basis of your digital currencies.
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