CGT on Crypto: What You Need to Know About Capital Gains Tax on Cryptocurrency

When you sell, trade, or spend cryptocurrency, a digital asset that can be bought, sold, or exchanged on blockchain networks. Also known as crypto, it behaves like property for tax purposes in most countries. That means every time you turn Bitcoin into Ethereum, sell Solana for cash, or use Dogecoin to buy a coffee, you might owe capital gains tax, a tax on the profit you make from selling an asset that has increased in value. It’s not about how much you earned—it’s about how much you gained. And if you didn’t track it, the IRS or your local tax authority will still expect you to pay.

CGT on crypto isn’t just about big sales. Even small trades count. Swap 0.1 BTC for 5 ETH? That’s a taxable event. Use 200 USDT to buy an NFT? Taxable. Hold for a year and sell at a profit? You might pay a lower long-term rate. Sell after a week? Short-term rates apply—often much higher. Many people think if they didn’t cash out to fiat, they’re off the hook. They’re wrong. The tax system doesn’t care if you traded crypto for crypto—it cares about value changes. And exchanges don’t always send you a 1099. That means you’re responsible for tracking every transaction, every fee, every swap.

It’s not just about the U.S. Countries like the UK, Canada, Australia, and Germany all treat crypto as property, not currency. Some have specific thresholds. Others tax every single trade. In places like India, you pay 30% on gains with no deductions. In Germany, if you hold over a year, you’re tax-free. But if you sell before? You owe CGT. The rules change by country, by wallet type, even by how you acquired the crypto—through mining, staking, or airdrops. And yes, airdrops can trigger income tax the moment you receive them, even if you don’t sell.

What you’ll find in these posts isn’t theory. It’s real-world examples of people who got caught. The ones who ignored CGT on crypto and ended up with penalties. The ones who used wrong cost basis calculations and paid double. The ones who thought DeFi swaps didn’t count—and found out the hard way. You’ll see how platforms like ErisX and EQONEX shut down, leaving users scrambling to report past trades. You’ll learn why fake tokens like DDM and BITS don’t matter for taxes—because if there’s no real trade, there’s no gain to tax. But you’ll also see how real projects like Superalgos and DePIN networks create taxable events when you earn tokens through participation.

There’s no magic tool that auto-fills your crypto taxes. But there are ways to stay ahead. Track your buys. Know your sells. Understand what counts as a disposal. And don’t wait until April to realize you owe thousands. CGT on crypto is here to stay. The question isn’t whether you’ll pay—it’s whether you’ll pay correctly.