The cryptocurrency is seeing a dip of 46% from its all-time high in May. Onramp Invest CEO Tyrone Ross says, the IRS has classified cryptocurrencies like bitcoin as property. Hence, the losses on cryptocurrencies are treated differently than the losses on stocks & mutual funds. One can sell bitcoin & buy it right back whereas one has to wait for 30 days to buy back the stocks. Head of the tax strategy at crypto ta software, Shehan Chandrasekara explains, investors sell bitcoin at a loss & later purchases it at a cheaper price. More the losses one can rack up the better for the investor. Since the wash sale rule doesn’t apply investors harvest their losses more aggressively. T the time of liquidating the crypto stakes they use these collective losses to reduce what they owe to the IRS through capital gains tax. In such cases, a detailed record of transactions is just as you cannot substantiate your calculations to the IRS.