Capital Gains Tax:
In most countries, when you buy and sell cryptocurrencies, any profit you make is typically subject to capital gains tax.
Many tax authorities require individuals to report their cryptocurrency transactions, including buys, sells, and trades, on their annual tax returns.
Mining and Staking:
Earnings from cryptocurrency mining or staking are also typically considered taxable income.
Gifts and Donations:
Giving or receiving cryptocurrencies as gifts or donations can also have tax implications.
Holding and HODLing:
If you simply hold cryptocurrencies without conducting any transactions, you may not owe taxes until you sell or exchange them.
Depending on your country's tax rules, you may need to determine the cost basis of your cryptocurrencies using methods like FIFO (First-In-First-Out) or LIFO (Last-In-First-Out) when calculating your capital gains.
It's essential to keep detailed records of all your cryptocurrency transactions, including dates, amounts, and counterparties.