I bought SOL with a cost basis of 200 two years ago. It’s sitting in Solflare. If I stake it, it becomes a taxable event. I’m down 70%. So would those losses carry over $3,000 per year until gone? I haven’t made any trades this year so I don’t have any profits to deduct the loss from.
Here is my amateur take on your situation. Staking itself is not a taxable event but the cost to do so is added to your adjusted cost base and the staking rewards you receive are taxed separately similar to interest from a high yield bank account. Since you have not sold your SOL yet, you do not have a capital loss for tax purposes but once you do sell some or all of it, then it becomes a taxable event and can consider the carry back and forward rules. As to stake or not stake, you should have staked all along given you’ve held your position. It’s like writing a covered call that never gets called - money that offsets your paper loss.