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Get your taxes done using TurboTax
Sorry to be the bearer of bad news, but there is no tax write off for the potential lost gains while your funds were inaccessible during a crypto exchange's bankruptcy proceeding. You didn't actually realize a gain or loss to have a taxable event when you were unable to access your funds.
This is true whether it's a situation such as you proposed where you could have realized a gain on your crypto, but for the bankruptcy keeping your currencies frozen, or if you would have liquidated your funds and taken cash out to reinvest in another asset.
Clarissa
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‎November 15, 2023
10:50 AM
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