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Level 2
November 15, 2023
Question

BlockFi Bankruptcy

  • November 15, 2023
  • 1 reply
  • 21 views

If I had assets with BlockFi which declared bankruptcy and locked my assets for a period of time before I was able to recover them, am I able to claim any sort of loss based on the opportunity cost of the time it was locked.

 

For example, if I purchased the crypto for $1,000.00 but then it became locked during the bankruptcy and inaccessible, and the price went up to $2,000.00 during this period, but by the time I was able to control my assets again it was $1,000.00, which I now control and still own, is there any tax claim or write off in this case based on the opportunity cost based on the banktruptcy?

1 reply

ClarissaA1
Level 4
Level 4
November 15, 2023

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. 

  

 

 

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