Using the Trading Tax Optimizer

Whether you are a frequent or occasional trader, you can use our platform to optimize your crypto taxes and check the tax implication of your trades before you execute them. Our Trading Tax Optimizer (TTO) can help you save hundreds or even thousands in crypto tax obligations.

You can use this tool to help you harvest your losses or to optimize your holding period. This article will go over how this tool works. We’ll start by preparing your data to use our TTO tool.

Preparing the data

First, make sure your transactions are all loaded onto our platform. Then you need to verify them for missing data by going through the review process.

Once you have verified your transactions, you would then need to choose your tax and disposal methods.

Selecting your tax & disposal methods

The tax and disposal methods you choose are an important decision to make. This is because your decision might determine how much tax you’ll have to pay. You can choose these methods by going to the settings page. The settings you’d want to look at are the tax method and the disposal method.

Tax method

The tax method can either be “Multi-Depot” or “Single-Depot”. Your selection here depends on if you want our platform to look at the assets in each wallet separately or as a whole. You can go here to learn more.

Disposal method

The disposal method can be “First In First Out” (FIFO) or “Last In First Out” (LIFO). This selection depends on if you want to trade the oldest or newest assets first. Go here If you want to learn more about these methods.

Note: “High In First Out” (HIFO) method is currently not available for use with the TTO tool.

How to use the TTO tool

Now that you completed the setup process, you are ready to get started by going to the “Trading Tax Optimizer ” section using our web app. The image below goes over the basics.

As you can see from the image, the graph shows when your assets become long-term investments. This is beneficial because, depending on where you live, you’ll pay less or even no tax on your long-term gains. You can use the graph to see the overview of your entire portfolio or to view individual assets.

Now you may wonder how to use it for specific tax and disposal methods. We’ll go over that next, starting with the most basic tax method, “Single-Depot”.


The term Single-Depot means that all the similar assets from each wallet/exchange get lumped together. So, it won’t matter what wallet/exchange you used to sell an asset, the tax outcome will always be the same. Although, what will change the tax outcome is what disposal method you choose.

The image below shows how the TTO tool works while using the FIFO disposal method.

The important thing to note here is that you will always sell your long-term assets first. So as shown in the example above, if you sell 50% of your DOGE at the time marked on the graph, 48% will be long-term gains and 2% will be short-term.

Now we will go over the next available disposal method, LIFO. The image below shows how this works for this tax method.

As you might have noticed in this image, this works exactly the opposite of how it did when using the FIFO method. That’s because you will always sell your short-term assets first. So in the same example, if you sold 50% of your DOGE at the time marked on the graph, all of it will be short-term gains, possibly resulting in higher taxes.

Next, we will go over how the Multi-Depot tax method works.


When using the Multi-Depot tax method, your tax consequences could be different depending on which wallet/exchange you used to sell your assets. This is because, unlike the Single-Depot tax method, this method separates your assets based on which wallet/exchange they are in.

The image below goes over how this works when using the FIFO disposal method.

As you can tell from the image above, our DOGE is now separated by “Exchange A” and “Exchange C”. If we wanted to sell 100,000 DOGE, “Exchange A” would give you $26,787.67 in short-term gains, and “Exchange C” would give you $26,827.67 in long-term gains. So selling the assets from “Exchange C” would give the highest return and the lowest tax outcome.

Your better choice here is easy. But as for the LIFO disposal method, that’s another story. The image below shows how this method works.

Just like before, the difference here is that you are selling your short-term assets first. So using the same example, selling 100,000 DOGE in “Exchange A” would give you the same $26,787.67 in short-term gains, but “Exchange C” would give you $4,666.13 in short-term losses and $24,144.90 in long-term gains. So “Exchange A” would give you higher returns with a higher tax outcome, but “Exchange C” would let you harvest some of your losses to offset the gains.

Your choice here is all dependent on your overall tax goals and the outcome you’d like to receive. It may be to lower your tax burden or to maximize your returns.


We hope the examples we provided give you a clear understanding of how the TTO tool works, and how it can help you optimize your trading strategy.

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