- Sean receives 1 Token A on 03/15/2018 as an airdrop. It has a Fair Market Value (FMV) of $10 so he pays ordinary income tax on $10, per current IRS guidance.
- Sean sells Token ABC for $11. The cost-basis is $10 - the FMV of the token when he received it on 03/15/2018. (Remember that cryptocurrency is considered property, and because it’s disposition causes a capital event, subjecting him to potential Capital Gains tax).
- His capital gains calculation is: 11 USD – 10 USD = 1 USD (gain).