No, there is no downside to filing the FBAR. You need to report the account if there is more than $10,000 in it at any point during the tax year.
Foreign currency losses are reportable as ordinary loss under Code Section 988.
Per IRS: Except as otherwise provided in this section, any foreign currency gain or loss attributable to a section 988 transaction shall be computed separately and treated as ordinary income or loss (as the case may be).
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