Cost Basis vs Market Value in Wallet Data
Keep historical cost records separate from current valuations, and avoid deriving a tax or accounting conclusion from a market-price API alone.
Overview
When translating these concepts into an integration, keep the scope described by the wallet history api with the result. The examples in wallet transaction history and smart contract event logs show how the same distinction affects neighbouring data questions.
Market value estimates what a holding is worth under a selected pricing method. Cost basis describes assigned historical cost under a separate policy. A price endpoint cannot determine every ownership or tax fact needed for that policy.
Keep independent records
Store quantities, movement evidence, price observations and cost assignments as separate layers. Transfers between owned wallets can preserve economic ownership even though chain addresses change. Fees, exchange activity and missing external history can affect a cost calculation. Do not overwrite an unknown cost with the current market price to make a report appear complete.
Worked example: transferred holdings
A wallet receives ten units from another wallet controlled by the same person. The market value at receipt is available, but the original purchase history is not. That observed value does not automatically become the historical cost. Keep the receipt and valuation while marking the missing cost evidence for the relevant accounting workflow.
Avoid hidden policy choices
Label the valuation method and any cost-assignment method separately. Test partial histories and assets received through different mechanisms. Tax treatment depends on facts and applicable rules beyond a technical transfer record. A neutral data product should preserve inputs and uncertainty so a separately authorised calculation can apply the appropriate policy.
A practical acceptance test
Transfer holdings from a fixture-owned wallet without providing the original purchase record. The receiving quantity and transfer-time market value can be known while historical cost remains unresolved. Assert that the importer does not assign zero or current price automatically. A later authorised cost record should attach as a separate layer without changing the chain transfer.
Questions about the topic
Frequently asked questions
Is transfer-time market value always cost basis?
No. The correct treatment depends on the underlying facts and applicable policy.
Should missing cost be zero?
Only if a justified policy establishes zero; missing evidence is not itself zero cost.
Standards & technical documentation
