Quick answer

In the U.S., most digital assets are treated as property for federal tax purposes. That means:

  • Gains and losses from sales or exchanges are reported as capital gains or losses (short‑term or long‑term depending on the holding period).
  • When you receive crypto or tokens as compensation, mining, staking rewards, or as business proceeds, the fair market value at receipt is generally ordinary income.
  • Tokenized real estate can be taxed like property, a partnership interest, or a security depending on how ownership and rights are structured.

(See IRS guidance on virtual currency: https://www.irs.gov/cryptocurrency; IRS Notice 2014‑21 and Rev. Rul. 2019‑24 provide the foundational positions on classification.)

How U.S. law treats these asset types in practice

Cryptocurrency (Bitcoin, Ether, stablecoins)

  • Classification: The IRS treats convertible virtual currency as property (IRS Notice 2014‑21). That means purchases, sales, and trades are taxable events.
  • Taxable events: Selling crypto for cash, trading one crypto for another, spending crypto to buy goods or services, or receiving crypto as income (wages, mining, staking) generally create tax consequences. The taxpayer recognizes gain or loss measured by the difference between the fair market value at disposition and the taxpayer’s basis.
  • Income events: Mining rewards, staking returns, and certain airdrops may be ordinary income at the time you have dominion and control over the asset. The amount included is the asset’s fair market value at that time (IRS resources and prevailing practitioner guidance).
  • Reporting: Most gains and losses are reported on Form 8949 and Schedule D (Form 1040). Exchanges may also issue information returns (e.g., 1099 variants), but consolidation and tax treatment can differ by provider.

Practical note: cost basis matters. If you bought Bitcoin in multiple lots, you can use FIFO or specific identification (if you can prove it) to calculate gain or loss. Keep granular transaction/exported exchange records to substantiate basis and holding period (IRS, 2024 guidance pages).

Internal resource: For detail on cost basis and common reporting pitfalls, see our guide on Cryptocurrency tax basics: [Cryptocurrency tax basics](