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What do I do if the tokens are worthless now, lost, stolen, or a scam?
What do I do if the tokens are worthless now, lost, stolen, or a scam?
Patrick Larsen avatar
Written by Patrick Larsen
Updated yesterday

Some of the most common crypto losses scenarios are-

1. Lost Crypto

You might have lost your tokens by sending them to the wrong wallet address or lost keys/access to your wallets. Such kinds of losses are usually referred to as casualty losses. A casualty is the damage, destruction, or loss of property resulting from an identifiable event that is sudden, unexpected, or unusual. Up until 2017 casualty losses were deductible. Later the rule was changed, and now from 2018 to 2025 casualty losses are deductible only if the losses are attributable to a federally declared disaster. Crypto losses are not tax-deductible.

2. Stolen Crypto

Cryptocurrencies are digital assets making them prone to theft. It includes loss of the coins due to wallet or exchange hacks, malware attacks compromising the access of funds, and stolen hardware that stores the funds. You cannot deduct losses due to crypto theft on your tax return.

3. Rug pull Scams/ ICO Fraud

Even though you can't get a deduction, it is important to keep good records of the loss of your coins for tax purposes. You can file a total loss of value or control of coins by going to Dashboard > Import More Transactions > Manual Entry > Outgoing, "Loss" from Dropdown.

4. Worthless Token

If the tokens that you have become virtually worthless and you wanted to get rid of that coin forever. Then you can create a send transaction with an incoming amount of 0.000000000001 USD. This event will be registered as an Outgoing transaction with capital losses.

This might trigger other complications. So we recommend you to do this under the jurisdiction of a tax professional at your own risk.

Here is a video showing how to mark the transaction as Stolen/Lost:

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