Hi there,
Given the recent issue with FTX exchange and currently they have halted withdraw of funds, if in the end, FTX resulted in insolvency. Can we claim the capitals within the exchange as capital loss? If yes, what kind of proof do we need?
Kind Regards,
Kevin
Hello @promenade
You can’t claim a capital loss just because an exchange had halted withdrawal or trading of your crypto assets. ASIC announced on 16 November 2022 that it had suspended the Australian financial services licence of FTX Australia Pty Ltd (AFS licence 323193) until 15 May 2023 and said:
“Until 19 December 2022, FTX Australia can continue to provide limited financial services that relate to the termination of existing derivatives with clients.”
If you have terminated a derivative position with FTX on or before 19 December 2022 and have incurred a loss, you have made a capital loss.
Outside of this, you will only make a capital loss when a CGT event happens to your crypto assets, most likely such as when event C1 or C2 applies to your crypto assets. Whilst a CGT event can occur for shareholders in companies when the liquidator makes a declaration that no more distributions will be made-event G3, this CGT event does not apply to cryptocurrency investments.
In order to demonstrate how a CGT event occurred, you should keep records which show you owned the crypto assets, like receipts when you buy, transfer or dispose of crypto assets, as well as evidence that the asset is lost or destroyed or cancelled or surrendered or similar endings. For more information go to Keeping crypto records (QC 69955).
Hi @promenade
We'll check in with our technical team to confirm what the correct treatment would be.
Hello @promenade
You can’t claim a capital loss just because an exchange had halted withdrawal or trading of your crypto assets. ASIC announced on 16 November 2022 that it had suspended the Australian financial services licence of FTX Australia Pty Ltd (AFS licence 323193) until 15 May 2023 and said:
“Until 19 December 2022, FTX Australia can continue to provide limited financial services that relate to the termination of existing derivatives with clients.”
If you have terminated a derivative position with FTX on or before 19 December 2022 and have incurred a loss, you have made a capital loss.
Outside of this, you will only make a capital loss when a CGT event happens to your crypto assets, most likely such as when event C1 or C2 applies to your crypto assets. Whilst a CGT event can occur for shareholders in companies when the liquidator makes a declaration that no more distributions will be made-event G3, this CGT event does not apply to cryptocurrency investments.
In order to demonstrate how a CGT event occurred, you should keep records which show you owned the crypto assets, like receipts when you buy, transfer or dispose of crypto assets, as well as evidence that the asset is lost or destroyed or cancelled or surrendered or similar endings. For more information go to Keeping crypto records (QC 69955).
I am new to mining Bitcoin and I was curious to see how efficient my PC is at mining. It turns out, it isn't as efficient as I thought and I have only made 0.[Removed by moderator] BTC (equivalent to $0.37 AUD at the time of writing). I plan to mine a little more so I can reach the minimum withdrawal amount, which I believe is 0.0010 BTC.
I was wondering what the easiest way to withdraw this money would be, so that I can close the wallet. Instead of mining to reach the minimum withdrawal amount, would it be easier to just deposit money into my Bitcoin wallet from my bank account and then withdraw from my Bitcoin wallet back to my bank account?
My plan is to do a direct transfer from my NiceHash wallet to Coinbase and then from Coinbase to PayPal. If I did this, would Coinbase automatically send all the required information to the Australian Taxation Office (ATO) so that my tax return is pre-filled? I would appreciate any help in directing me in the right direction. Thank you.
I am also currently on Centrelink and unsure if I need to include these small earnings some how in my next reporting period. I report every fortnight currently un employed.
Hello @Cc1468,
We have answered this question on your other post.
15 Apr 2026 · 8 min read time
4 Dec 2023 · 9 min read time
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4 replies