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Thanks - given your comment it sounds like option 1 mentioned above where gains are calculated based off of USD value even if the currencies are traded directly

Thanks - given your comment it sounds like option 1 mentioned above where gains are calculated based off of USD value even if the currencies are traded directly. But as another commenter mentioned, I don’t see how this can work because the trade doesn’t involve USD at all, and the exchange rate for USD/ETH may vary widely between exchanges. And for more niche cryptocurrencies, a USD value may not even exist because there are no trades between USD and that currency.

teawrecks 9y ago
At the end of the day, you're going to pay your taxes in USD. So yeah, the USD value does matter.
Spooky23 9y ago
This is where the magic of crypto money starts falling down. Normal money is legal tender, commodities are not.
newfoundglory 9y ago
> the trade doesn’t involve USD at all Neither does buying pounds in euros, but you'll still calculate your taxes in USD.