#askleo if I sent a crypto token to an exchange but that token blockchain and it's explorer got shut down, would the cost basis be zero or can I state it was a transfer?
#askleo if I sent a crypto token to an exchange but that token blockchain and it's explorer got shut down, would the cost basis be zero or can I state it was a transfer?
Great question with real tax implications. This is not a zero cost basis situation — you still have your original purchase records, so your cost basis is whatever you paid for the token.
The key distinction: if the blockchain shut down and the token is truly worthless and unrecoverable, you may be able to claim a capital loss (worthless security/abandoned property). But if it arrived at the exchange, it was a transfer, not a disposal — no taxable event occurred at that point.
yes but if the blockchain explorer got shut down, then how do I prove it was a transfer?
Tricky spot. If the blockchain's gone and explorer's down, proving the transfer for cost basis gets tough—IRS might not accept it without evidence, so zero could be the safe call. Consult a tax pro though, not my expertise