2025-12-31 17:20:44

Recently opening market apps, the crypto market is all "green," and various voices are loud—bear market is coming, retail investor confidence is collapsing. But the truth may be completely different. After years of immersion in the crypto space, I see that behind this wave of selling there is a different story: North American retail investors are preparing for the upcoming tax storm.

The key time point is 2025. Starting this year, US centralized trading platforms are required to report users' coin selling records and transaction flows directly to the IRS. By the 2026 tax season, retail investors will also receive dedicated forms. On the surface, this looks very formal, but the problem lies in the details: initially, this form will only show how much you earned from selling coins, with no deductions for the original purchase cost, transaction fees, or other costs.

This creates a big trap. Without clear proof of the purchase cost, the IRS will directly calculate your taxable income as "cost basis zero." When the tax notice arrives, the amount is often shocking.

More complicated is that, starting in 2025, the IRS requires calculating cost basis separately for each trading platform account and each wallet. In other words, coins sold on Platform A can only be matched with the purchase records from Platform A; coins from a self-custodied wallet can only be matched with that wallet’s cost basis; trying to mix across platforms to reduce taxes? That’s completely impossible.

This explosion of complexity makes everything much more difficult. For traders holding multiple platform accounts, frequently withdrawing funds, and deeply involved in DeFi, tracking costs becomes a nightmare. What was once a bit of a gray area now requires precise matching for every transaction.

So what you’re seeing isn’t market pessimism about the future, but retail investors acting in advance—quickly clearing unclear cost records or cross-platform positions to avoid passive tax payments. This wave of selling, frankly, is rational self-preservation.

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RamenDeFiSurvivor

· 5h ago

Damn, IRS's move is the real market dump artist. We retail investors are all being chopped like leeks. --- Should have kept good records from the start. Now I’m full of regret. --- Brothers doing cross-platform DeFi are doomed. This time, there's really no way to avoid taxes. --- No wonder some people have been rushing to clear out their positions these past few days. Turns out they’re just trying to dodge the tax storm in advance. --- Zero cost? The IRS’s logic is completely absurd. Paying taxes back really is terrifying. --- I just want to ask, how can you prove the cost of a self-custody wallet? Why is it calculated as zero? --- That’s the real reason behind the “green and lush” situation. It’s either a confidence issue in the bear market or being forced to sell off. --- Multi-account DeFi users are really panicking now. Do all transactions have to match up? --- Rational self-rescue sounds good, but us small retail investors are just passively running away. --- The IRS form in 2026 might blow up a bunch of people’s accounts. Who will be the last to laugh?

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OnchainDetectiveBing

· 5h ago

Wow, now I understand. No wonder everyone has been selling off crazily recently. This is definitely not a bear market. IRS's move is really ruthless, directly taking at zero cost? Tax nightmare warning. I was wondering why this wave was so orderly; it turns out everyone was playing a big game of hide and seek with the tax authorities. The era of cross-platform ledger chaos is really coming to an end. From now on, careful bookkeeping is a must. If I had known earlier, I wouldn't have gone through so much trouble. Now I have to go through all the transactions for reconciliation. Just thinking about it gives me a headache.

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0xSherlock

· 6h ago

Damn, IRS's move is really clever... zero-cost tax calculation? Isn't this outright robbery? The tax storm is coming, retail investors better run first, no wonder this wave is green. So this isn't a bear market, just a collective self-rescue action. Brothers across multiple chains and platforms are going crazy this time, every transaction has to match... nightmare level. 2025 is really going to change the game rules, need to settle accounts in advance. Those who anticipated this should have already withdrawn. Wait, what about those who didn't record their costs? Bankruptcy directly? This logic is super clear... no wonder the sell-off is so fierce. IRS is serious this time, North American retail investors are being forced. Need to carefully review your accounts, don't get caught.

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NoodlesOrTokens

· 6h ago

Now the case is really solved. No wonder so many people have been rushing to dump recently. It's not a bear market at all, but rather a tax evasion trap. IRS's move is really clever. With the cost basis locked like this, multi-chain wallet users are going to cry their eyes out. With this approach by the Americans, how many retail investors are being forced into a "zero cost" trap? By the way, has anyone started organizing their transaction records? If not prepared in advance, they might really be out of luck in 2026. DeFi players are in trouble now. Cross-platform tracking is already tough, and now there's no way out. I just want to know if there's any way to avoid this. It seems pretty unrealistic. Retail investors' recent sell-off is truly rational. Instead of waiting to be harvested by the IRS, it's better to self-serve early. It looks like I need to develop good habits—keeping track of every transaction from now on. That's the real cost.

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