That is not correct. If you sold the crypto back to fiat currency, you DEFINITELY DO need to enter that sale on Schedule D. Per IRS notice 2014-21, crypto is a capital asset. Whenever a capital asset changes character (in this case, changed from BTC to USD), you must report it on Schedule D. Not reporting the sale can cause problems with the IRS.
So first you will convert the .32 BTC to USD to determine fair market value (FMV) on the date of receipt. Then you will report that FMV as self-employed income.
Next, you will enter the sale of the BTC to USD. The cost basis of the BTC you sold can be set at the value of the services you rendered (likely the FMV of the service you rendered), and your transaction records will show the USD value of your proceeds on the date of sale. Any gain or loss on the sale will then flow to Schedule D.
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