Although bitcoin is down from a record high above $73,000 in mid-March, the price is still up more than 50% year-to-date as investors weigh comments from Former President Donald Trump and this week’s Federal Reserve meetings.

The price of bitcoin fell to a two-month low in early July after the Fed’s June minutes indicated they weren’t yet ready to cut interest rates.

“For too long our government has violated the cardinal rule that every bitcoiner knows by heart: Never sell your bitcoin,” Trump said Saturday during a keynote at the Bitcoin Conference in Nashville.

“If I am elected, it will be the policy of my administration, United States of America, to keep 100% of all the bitcoin the U.S. government currently holds or acquires into the future,” Trump said.

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Meanwhile, investors are watching for signs of a possible Democratic crypto policy shift from Vice President Kamala Harris, who entered the presidential race last week after President Joe Biden dropped out. While Harris hasn’t outlined policy yet, some investors hope she’ll pivot from the crypto scrutiny led by Securities and Exchange Commission Chair Gary Gensler and Sen. Elizabeth Warren, D-Mass.

While future crypto policy and regulation are unclear, here are some key things to know about taxes, experts say.

When you trade one coin for another or sell it at a profit, it may be subject to capital gains or regular income taxes, depending on how long you owned the asset.

After holding crypto for more than one year, you’ll qualify for long-term capital gains of 0%, 15% or 20%, depending on taxable income. Higher earners may also owe an extra 3.8% levy, known as net investment income tax.

By comparison, short-term capital gains or regular income taxes apply to assets owned for one year or less.  

Your gain is the difference between your original purchase price, or “basis,” and the asset’s value when you sell or exchange it — and without establishing basis, the IRS assumes it’s zero, according to Adam Markowitz, an enrolled agent at Luminary Tax Advisors in Windermere, Florida.

With zero basis, you could wrongly report more capital gains to the Internal Revenue Service.

“The burden of proof is on the taxpayer to know what they paid,” which can be challenging for investors with multiple exchanges and hundreds of transactions, especially when they don’t know what counts as a sale, he explained.

The U.S. Department of the Treasury and IRS in June released final guidance for digital asset brokers, which phases in mandatory yearly reporting.

Required yearly reporting will phase in starting in 2026, with digital currency brokers required to cover gross proceeds from sales in 2025 via Form 1099-DA. In 2027, brokers must include cost basis for certain digital asset sales for 2026. 

With limited past reporting on basis, crypto investors can still establish a “reasonable allocation” before Jan. 1, 2025, according to an IRS revenue procedure released in June.

“Even in the current year, in 2024, as you’re selling tokens, it may make sense to speak to a tax professional about how you can specifically identify or allocate cost basis to those sales,” said Andrew Gordon, tax attorney, certified public accountant and president of Gordon Law Group.