Add loan and liquidation transactions

You may need to add loan and liquidation transactions directly in CoinTracker, especially for self-custody wallets and crypto-collateralized loans. Read on to learn how to add these transactions to your account.   

Add a new wallet for loan vaults

To represent loan vaults you can add a new wallet to your account by importing a CSV with a placeholder transaction. This ensures the wallet is created but remains empty to help organize and track loan vault transactions within your portfolio.

Steps to create the empty wallet

Step 1: Prepare the CSV: Download the CoinTracker CSV template to create a file with a single placeholder transaction.

• The placeholder transaction will not be imported, keeping the wallet empty.

The headers must match the template exactly as follows:

Step 2: Imported the wallet with the CSV:

1. Navigate to the Wallets page, and click Add wallet.
2. Enter Import into the search and select CSV.
3. Enter a wallet name.
4. Select the file to import and click Import to complete.

For the wallet name, choose something that will easily identify which vault or location this represents.

Editing collateral send transactions

When you send collateral for a loan, you intend to get that crypto back. Edit the Receive transaction to show the collateral as Transferred to the loan wallet you created in the previous step.

To represent collateral returned to you, edit the Receive transaction to show the collateral as Transferred back to your wallet. This ensures no gain or loss is calculated.

Handling loan liquidation

If your collateral was liquidated while in the vault, you can manually add a transaction to represent it.

1. Create a Send transaction for the liquidated amount.
   • Set the transaction date to the liquidation date.
   • Use the appropriate vault wallet you created as the Sending wallet.
   • CoinTracker will calculate the loss based on this transaction.
2. Change the transaction category to Liquidation to accurately reflect the event.

You'll see the loss calculation on that transaction once complete.

Loan funds received

Manual transactions don’t update balances automatically like synced transactions, so the balance may not reflect changes, such as a reduction when tracking collateral.

To track loan transactions:

• Tag received loan funds as Borrow.
• Tag loan repayments as Loan Repayment.

Learn more about tag definitions and tax implications. For more information about crypto-collateralized loans, check out this guide.

Fees

Additional fees may apply to crypto-collateralized loan activity. If not already included in your transactions, you can add them manually as Send transactions, tagged as Interest expense to reflect loan interest payments.

Example

In this loan liquidation scenario:

1. Collateral sent: User sends 10 ETH to a vault as collateral.
2. Liquidation: Due to a drop in crypto prices, 6 ETH is liquidated, resulting in a loss.
3. Remaining collateral: User receives back the remaining 4 ETH.

Note: This example doesn't include fees, penalties, or other charges. You may need to add these manually to your transactions.

Steps to track this in CoinTracker:

1. Create a wallet for the vault: Follow the above steps to create a wallet representing the vault (e.g., "ETH Vault") and import it via CSV. This will be used to assign transactions.
2. Send transaction to vault: If 10 ETH is sent to the vault, either edit the Receive transaction to assign it to the ETH Vault wallet or manually add the transaction if it's missing.
3. Receive transaction from vault: For the remaining 4 ETH returned to the user, edit the Receive transaction to show it as coming from the ETH Vault wallet.
4. Account for liquidation: For the 6 ETH that was liquidated, create a manual transaction to show the loss. The date of this transaction should be the actual date of the liquidation. This is the only transaction in this sequence that will have a gain/loss calculation.

Note: If you recreate automatically synced transactions, be sure to mark the originals as Ignore to avoid duplicates.