How to treat these series of transactions?

I put 2.5 ETH into a service and I got nothing back.

Then every day the service sends me some USDT.

How do I treat these transactions for tax purposes? It is not staking because I don’t get the 2.5 ETH back.

I’m thinking of treating it like this:

  1. For the transaction where I send 2.5 ETH into the service I change the proceeds to $0. So the full amount gets marked as a capital loss.
  2. Then for each day that I receive a transaction for some USDT from the service I mark it as a payment, so it is taxed as income.

Is this how I should do it? Or is there a better way?

For the ETH sent I would use a classification instead. You could use fee, lost or payment.

For the received USDT i would classify the transactions as income.

Can you tell me more about this service? I would like to try it after doing some research.

Best regards,
Michel.