Can cryptocurrency losses offset crypto gains in Australia?

Yes. Cryptocurrency losses are capital losses and can be used to offset capital gains, including gains from other crypto assets. If you sell crypto at a loss, the capital loss can reduce your net capital gain for the year, reducing the tax payable.

Capital losses from crypto can also offset capital gains from other assets like shares or property. There is no requirement that losses from one asset class only offset gains from the same class. All capital gains and capital losses are pooled together. You calculate your net capital gain (total gains minus total losses), apply the 50% discount where eligible, and the result is added to your assessable income.

If your total capital losses exceed your total capital gains in a year, you have a net capital loss. This cannot reduce your ordinary income. It is carried forward to offset future capital gains in subsequent years. Be aware that the ATO requires accurate records of every crypto transaction: the date, the amount in AUD at the time of the transaction, and what happened. Using a crypto tax tool that connects to your exchange history can save significant time at tax time.