Warning trades happen when you have not imported all of your historical data. In other words, you are missing some data.
A transaction is flagged as a warning when the CryptoTrader.Tax engine detects that you appear to be selling more of a coin than you own at the time. This happens when you are missing certain data detailing how you acquired a certain coin(s).
How does this happen?
Let's say you bought 1 BTC on Coinbase for $1,000. You then sent this BTC to Binance to trade other coins.
If you only upload your Binance trade history into CryptoTrader.Tax, CryptoTrader.Tax will have no way of knowing that you acquired that BTC for $1,000 on Coinbase, and it will look like that BTC appeared out of no where. This will trigger a warning trade. You haven't imported the data that shows how you acquired that BTC.
If CryptoTrader.Tax can't detect when and how you initially acquired the crypto that you are trying to trade, there is no way for it to know at what US dollar value you acquired it at. Thus, there is no way to calculate your cost basis which is needed for tax purposes.
CryptoTrader.Tax will still run your report in spite of these warnings. Learn how this will affect your report.
The most common causes of a warning trade are the following:
- You didn't include data from all of the exchanges or platforms that you bought or traded crypto on
- You didn't include your data from ALL of the years that you have transacted or traded crypto
- You didn't include crypto you received from mining, staking, interest earned, Coinbase Earn, or other forms of income (Learn how here)
- You traded on both Coinbase and Coinbase Pro but did not upload both exchanges
- You accidentally uploaded the same CSV file for an exchange twice resulting in duplicate trades that are triggering warnings
- You received crypto from a Binance distribution like the BNB rebate or from a fork but did not account for it. Not sure if you received crypto from a distribution? Please view our Binance Distribution article here.
- You purchased or sold crypto directly from your software wallet provider but did not import those buys/sells.
Fix your warning trades by importing your missing data.
Still stuck? Think there is a different problem? Please reach out to our team here on Intercom. We are happy to help!