Ripple’s David Schwartz Paid $1.7 Million in Tax on the XRP He Sold. How Much Would You Owe If You Sold Yours?

David Schwartz, one of the original creators of the XRP Ledger, has shared what XRP taxes cost him, a bill many XRP (CRYPTO:XRP) holders put off until tax season. In a post on X today, he wrote, “In 2025, I sold about 2.5 million XRP, most of which I received in 2020 and 2023. I paid approximately $1.7 million in capital gains tax on those sales.”

Federal tax rules apply equally to all holders, varying only with the size of the gain and the individual’s income. The hypothetical sales below show what a typical holder could owe, and how losses can reduce the tax bill.

Schwartz Paid $1.7 Million in Tax on About 2.5 Million XRP

Schwartz sold about 2.5 million XRP in 2025 and paid around $1.7 million in tax on those sales. He had held the coins for more than a year, having received them in 2020 and 2023. Under the tax code, that holding period makes his profits long-term capital gains (26 U.S.C. § 1222(3)). Long-term gains are taxed at the lowest federal rates, so his bill came under the most favorable treatment available.

Schwartz did not disclose his gain. At federal rates alone, his tax points to a gain of about $7.1 million at the 23.8% combined rate, which includes the net investment income tax, or about $8.5 million at the 20% top rate. That works out to roughly $2.85 to $3.40 of profit per coin. Schwartz has not confirmed these estimates or said whether his figure includes state taxes, which would lower the implied gain.

XRP’s daily closes in 2025 ran from under $2 to above $3, so the price on each sale date set the size of his gain. Schwartz’s sales are separate from Ripple’s own monthly XRP sales, and he has argued that XRP should gain if the XRP Ledger succeeds.

How the IRS Taxes XRP Sales

For tax purposes, the IRS classifies cryptocurrencies as property (Rev. Proc. 2026-20, citing Notice 2014-21). So each sale of XRP results in a capital gain or loss, equal to the sale price minus the cost basis, which is generally what the holder paid for the coins. If you received coins as payment or a grant, their basis is typically their value on the day they arrived.

The tax code sets long-term capital gains rates of 0%, 15%, or 20%, depending on taxable income. Under Section 1411, higher earners also owe a 3.8% net investment income tax on income above set thresholds (26 U.S.C. § 1411(a)(1)). However, an XRP sale within a year of purchase counts as ordinary income, taxed at federal rates from 10% to 37%.

The hypothetical sales below use a price of about $1.10, XRP’s level, down 39.7% since the start of 2026.

In example (b), a holder in the 15% tax bracket would owe $900 on a $6,000 gain. Meanwhile, the $9,000 loss in example (c) first offsets any other capital gains, then up to $3,000 of ordinary income a year under Section 1211 (26 U.S.C. § 1211(b)). Any remaining loss carries forward to future years (26 U.S.C. § 1212(b)).

Cost Basis, Tax Lots, Wash Sales and State Taxes Shape the Final Bill

• Cost basis records. Good records include the date, price, and fees for every purchase. Brokerages report sales of Bitwise XRP ETF (NYSEARCA:XRP) shares on a standard 1099-B form. However, once coins move to a private wallet, record-keeping becomes the holder’s responsibility.
• Tax lots. Each purchase is treated as a separate lot, with its own basis and its own one-year clock. Coins bought the day Ripple won its SEC case carry a different gain than coins bought in 2025, so the lot a holder sells changes the tax.
• Wash sales. The Section 1091 wash-sale rule doesn’t apply to crypto yet, so a holder who sells XRP at a loss and buys it back within 30 days can still claim the loss. However, a Senate bill would extend the rule to crypto.
• State taxes. Many states tax capital gains as regular income, on top of federal taxes. However, states with no personal income tax, such as Texas and Florida, add nothing.

How Much Would You Owe If You Sold Your XRP?

An average XRP holder may owe a small fraction of Schwartz’s bill, because federal tax applies only to profits. A $600 profit costs $90 at the 15% rate. However, selling within a year will likely cost more, since those gains are taxed at regular income rates of up to 37%. On the upside, long-term holders can donate XRP to a qualified charity and usually deduct its full value without paying tax on the gain.

For recent buyers, the math runs the other way. XRP trades below every 2025 daily close, so anyone who bought in 2025 holds a loss. If the price stays below those 2025 levels, you could sell XRP by December 31 to book a deductible loss, and since the wash-sale rule doesn’t cover crypto yet, you could buy it back right away. This is general information, not tax advice for any individual’s situation.

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