As of right now I have been hodling few thousand worth bitcoin, I didnt cash it out. But because of price drop, I am in loss. How do I file this on tax return in US?
If you just bought and held BTC and have never sold it, no taxable event has occurred yet. Nothing is reportable on your taxes yet.
I think he is talking about the loan he received from his family members which I think is still the same nonetheless. If it is really just a loan then I don't think you need to report it to the IRS as I don't think loans in itself are taxable. Also in your case where your BTC loan is now below its original value when you have received it is not taxable so it's really not necessary to report it as you won't be taxed from your losses.