How to account for stablecoins in a portfolio
You account for stablecoins by tracking each as a cash-like holding, logging issuer, network, quantity, date, and value, then reporting taxable events and yield.
Vahe HakobyanEditor-in-chief
Updated Oct 6, 20263 min readFact-checked
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The IRS treats stablecoins as property for tax purposes. Your records must show what you hold and what you did with each one.
What does stablecoin accounting mean?
Treat each stablecoin as a cash-like holding and track it on its own line, apart from volatile crypto. Record the issuer, network, quantity, acquisition date, and dollar value. A stablecoin from one issuer is not the same as one from another, even when both aim for the same peg.
How do you record them step by step?
The tax rules treat stablecoins as property. Trades, redemptions, and conversions can create capital gains or losses, while yield and rewards are income in the year you receive them.
- 1Create a separate ledgerOpen a spreadsheet with one row for each holding. Add columns for cost basis, income, transfers, and notes.
- 2Enter acquisition detailsRecord the date and dollar value when you receive the stablecoin. That value is your starting cost basis.
- 3Log trades and conversionsNote the date, amount, asset received, and dollar value. A trade, redemption, or conversion is a taxable event.
- 4Add yield and rewardsEnter interest or rewards as income when you receive it. Add that amount to your cost basis.
- 5Reconcile and note depegsCompare wallet and exchange balances to your ledger each month. Write down any depeg date, value, and amount.
What records and safety checks follow?
Reconcile your ledger against each wallet and exchange balance, and note any depeg or redemption. Read the issuer's reserve reports and redemption terms, because a peg is a target, not a guarantee.
Frequently asked questions
No. The IRS treats them as property, so selling, trading, or paying with one can create a capital gain or loss. Holding them does not trigger tax.
Usually no. A transfer between wallets you control is not a sale or exchange, so it does not create a gain by itself. Keep it in your records.
Note the date, market value, and amount in your ledger. A depeg is not taxable by itself, but a later sale at a lower value can create a capital loss.
Recovery depends on the exchange's legal structure and the terms you accepted. Keep your own records and wallet keys, because an exchange dashboard is not a permanent record.
