How are crypto trading profits taxed?

Crypto trading profits are typically taxed as capital gains or income, depending on your location and how long you hold assets. In the US, profits from crypto held less than one year are taxed as short-term capital gains (your regular income tax rate), while profits from assets held over one year qualify for lower long-term capital gain rates. Some countries treat all crypto transactions as income. You must report each trade's profit or loss, calculated by subtracting your purchase price from your sale price. Tax obligations apply to all conversions—swapping one crypto for another counts as a taxable event. Many countries now require exchanges to report user trading activity to tax authorities. Keeping detailed records of all transactions, dates, and amounts is essential for accurate reporting.