Assume in 2018 I acquired 1 Bitcoin for $10000 USD and in 2023 I exchanged it for 10 Ethereum (numbers are random and used purely as an example). Assume the bitcoin exchange at the time of exchange is $20000 per Bitcoin, then afaik I need to pay (20000 - 10000)*0.15 = $1500 capital gains tax in my 2023 tax return, even though I never sold that bitcoin for USD, as a crypto to crypto exchange is a taxable event.
Assume now the 10 Ethers I acquired in 2023, drop in value in half when I sell them in 2025, and I sell them for $10000 USD. Therefore I started my crypto investment with $10000 and I exited with no gain or loss. However I paid $1500 in tax in between because I made that exchange between 2 different cryptocurrencies. In 2025 return I am going to report a $10000 loss. Does this mean I am getting the $1500 from IRS back?
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