Crypto Investors Need to Understand Tax Implications

Crypto investors should be aware that holding digital currency is not taxable by itself, but selling cryptocurrency or using it to purchase something and appreciating in value is. The IRS considers rules around them similar to capital gains rules.

AJ Flores with Portfolio Advisors notes that 'there are new tax forms being phased in in 2026 by the IRS' which means these accounts will have 1099s.

'The core drivers of its value are supply, demand and market sentiment,' Flores said. This means price swings can be significant.