Your crypto exchange is reporting what it knows to the IRS and might be leaving the basis line empty. On Form 8949, a digital asset sale where basis was not reported goes in box H if short-term, box K if long-term. Proceeds come from the 1099 into column (d). Column (e), the basis, is yours to fill. A lot of sales land there, because "covered security" is narrow: acquired after 2025, in a custodial account, held there until disposition. All three. Where your own records do not exist, basis collapses toward zero and the gain inflates. That is more alarming than the story people repeat, and it happens to be the accurate one.

The full code set. G and J, basis reported to the IRS. H and K, basis not reported. I and L, not on any 1099 at all. Digital assets must not use boxes C or F. Our team is not a CPA firm and does not provide tax advice.

Code B in column (f) is how you adjust a broker basis that came through wrong. That is a different fix from an empty column (e) and the two get confused constantly.