Bot Trading and Crypto Taxes: What Happens When You Have 50,000 Transactions

You ran a trading bot for a year. Maybe a grid bot on Binance, an arbitrage bot across three exchanges, or a custom strategy on dYdX. Now you have 50,000 or more transactions and a tax deadline approaching.

Sound familiar? You're not alone. Bot traders are some of our most common clients at HandyTax, and for good reason — the tax reporting challenge is enormous.

The volume problem

Most crypto tax software is designed for people who make a few hundred trades a year. When you throw 50,000 or more transactions at it, things break in predictable ways.

Import times become absurd. Cost basis matching becomes unreliable. The software might time out, produce errors, or simply generate a report that doesn't make sense.

And that's before you factor in the complexity of what bots actually do — rapid-fire buys and sells, sometimes dozens per hour, across multiple trading pairs.

Cost basis nightmares

When a bot executes trades every few minutes, matching each sell to the correct purchase becomes incredibly complex. Which buy corresponds to which sell? FIFO, LIFO, or average cost? The answer depends on your jurisdiction, and getting it wrong can mean a very different tax bill.

With thousands of micro-trades, even a small matching error compounds quickly. A few pence off per trade, multiplied by 50,000 trades, can add up to thousands in miscalculated gains.

Exchange API gaps

Not every exchange provides clean data for bot trades. Some API exports miss fields, truncate decimal places, or batch small trades together. CSV exports might cap at 10,000 rows or exclude certain transaction types entirely.

If your bot traded on a less popular exchange, the data quality problem gets even worse. Some exchanges don't even distinguish between manual and automated trades in their export files.

The Koinly limit

Koinly's free tier caps at 10,000 transactions. Their premium plans handle more, but even with premium, the matching algorithm can struggle with very high-volume data.

We've seen Koinly reports for bot traders that show negative balances, phantom assets, and gains that are physically impossible given the trading history. It's not Koinly's fault — it's just that the data volume overwhelms what the algorithm can reliably handle without human intervention.

Our approach to high-volume reconciliation

At HandyTax, we handle bot trading accounts regularly. Our process:

1. Full data extraction — we pull every transaction from every exchange, using APIs, CSVs, and direct exports, whichever gives us the cleanest data
2. Deduplication — we remove duplicate entries from overlapping data sources
3. Cost basis matching — we apply the correct matching method for your jurisdiction, verified trade by trade where needed
4. Anomaly detection — we flag anything that looks wrong: negative balances, impossible prices, missing counterparts
5. Human review — a real person checks the output before it goes to you

This process takes longer than a standard reconciliation, which is why our Bot Trading tier exists. It's specifically priced for the extra work involved.

What this costs

Our pricing is transparent. The Bot Trading tier covers portfolios with 25,000+ transactions and complex automated trading. You can see the exact price on our pricing page, and we'll give you a firm quote before starting any work.

We've handled portfolios with over 200,000 transactions. If you're running a bot and dreading tax season, get a quote and we'll tell you exactly what's involved.