The IRS has defined interest as “an amount you pay for the use of borrowed money” (see: IRS Topic 505 Interest Expense). The IRS has defined virtual currency as “property” (see: Notice 2014-21). As such, Gemini does not believe that reporting the earnings from borrowed crypto currency on the Form 1099-INT is appropriate.
This content is for general informational purposes only and is not tax advice. You should consult a qualified, licensed advisor to understand the risks and reporting obligations before engaging in any transaction.