I was refunded in USDC for a BTC theft. I received the USDC value equivalent of BTC that was in my account from Coinbase. Since this was a theft, am I responsible for paying capital gains tax on the BTC to USDC conversion although I was not the individual who initiated this transaction? There was a profit from initial BTC I purchased years ago. I still hold the USDC funds and they have not been transferred outside of the account to US dollar. Thank you.
Hi @buddylee203
Since this situation involves a theft and a refund in a different asset (USDC), the tax treatment can get complex — especially if there is a capital gain involved from the original BTC purchase.
In Koinly, we cannot provide tax advice so I suggest you consult with your tax accountant.
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