Glossary
Cost basis
The original value of an asset for tax and accounting purposes, tracked per lot, from which gain or loss on disposal is calculated.
Lot-level tracking is the requirement that most digital-asset businesses fail. Assets arrive from many sources, move between wallets, get wrapped and unwrapped, and are disposed of in fragments — and the identification method chosen has to be applied consistently and disclosed.
Reconstructing basis historically is possible but expensive, and it is usually discovered at the worst moment: during a first audit, or when a reporting obligation requires it.
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