London Daily

Focus on the big picture.
Friday, Sep 19, 2025

Crypto traders are facing a tax crackdown by the US Treasury

Crypto traders are facing a tax crackdown by the US Treasury

A new report could have major implications for US crypto users as authorities seek to modernise outdated tax infrastructure.

Cryptocurrency traders in the United States could face more stringent tax reporting requirements under proposals put forward in a new report from the US Treasury.

The report said cryptocurrencies were a "significant concern," saying they presented a significant obstacle for tax authorities by helping to facilitate illegal tax evasion.

The proposals would also see government investment in America's tax office, the Internal Revenue Service (IRS), funding it by an additional $80 billion (€65.5 billion) over the next decade.

The moves are part of a plan to close the "tax gap" – the difference between taxes owed and taxes paid – which could rise to around $7 trillion (€5.7 trillion) over the course of the decade, the report said.

Also falling into the tax authorities' crosshairs are wealthier Americans who tend to make more of their money from assets.

"While roughly 99 per cent of taxes due on wages are paid to the Internal Revenue Service (IRS), compliance on less visible sources of income is estimated to be just 45 per cent," the report said.

Crypto under scrutiny


Among the proposed changes, businesses that receive "cryptoassets" worth more than $10,000 (€8,176) would have to report them to the IRS, bringing cryptocurrency into line with current rules on cash receipts.

Another policy change would require payment services providers to file Form 1099 reports in order to discourage their clients from attempting to hide their income by using alternatives to traditional banks.

"Although cryptocurrency is a small share of current business transactions, such comprehensive reporting is necessary to minimise the incentives and opportunity to shift income out of the new information reporting regime," the report said.

One major stumbling block for US tax authorities is the outdated technology in use by the IRS, which has held back the agency's ability to tax income held in assets like crypto.

According to the report, the IRS's main tax processing system, responsible for processing over 150 million annual tax returns that account for $1.2 trillion (€981 billion) in revenue, is written in programming languages that date back over half a century.

The combination of outdated tech and the growth of alternative finance has disproportionately benefited America's top earners, "who can avoid taxes through sophisticated strategies such as offshoring, creating complex partnership structures, or moving taxable assets into the crypto economy," the report said.

SEC backs tougher regulation


Also on Wednesday, US Securities and Exchange Commission (SEC) Chair Gary Gensler indicated he would also like to see cryptocurrency trading come under tougher regulation.

"This is a quite volatile, one might say highly volatile, asset class, and the investing public would benefit from more investor protection on the crypto exchanges," Gensler said in remarks at the Financial Industry Regulatory Authority (FINRA)’s annual conference.

"Technology is always evolving, as are our markets. As we continue to stay abreast of those developments, the SEC and FINRA should be ready to bring cases involving issues such as crypto, cyber, and fintech," he said.

Speaking to Bloomberg on Wednesday, European Central Bank Vice President Luis de Guindos said cryptocurrencies had "very weak fundamentals" and that investors should be prepared for more violent swings like Wednesday's crash.

"When you have difficulties to find out what are the real fundamentals of an investment, then what you’re doing is not a real investment," de Guindos said.

Newsletter

Related Articles

0:00
0:00
Close
DeepSeek Claims R1 Model Trained for only $294,000, Sparking Global Debate Over China’s AI Capabilities
SoftBank Vision Fund to Cut Nearly Twenty Percent of Staff in Bold AI Strategy Shift
Intel’s Next-Gen Manufacturing Gets a Lifeline from Nvidia’s Strategic $5B Deal
Erika Kirk Elected CEO of Turning Point USA After Husband Charlie Kirk’s Assassination
Massive Strikes in France Pressure Macron and New PM on Austerity Proposals
Trump Seeks Supreme Court Permission to Remove Fed Governor Lisa Cook
Hillary Clinton’s Reckless Rhetoric Fuels Division After Charlie Kirk’s Assassination
NASDAQ Rises to Record as Intel Soars More Than 20%, Nvidia Gains 3%
Nvidia’s $5 Billion Bet on Intel Reshapes AI Hardware Landscape
Trump and Starmer Clash Over UK Recognition of Palestinian State Amid State Visit
Trump’s Quip on Biden and Google Lawsuit Revives Debate Over Antitrust Legacy
Macron and his wife to provide 'scientific photographic evidence' that she is a real woman
US Tech Giants Pledge Billions to UK AI Infrastructure Following Starmer's Call
Saudi Arabia cracks down on music ‘lounges’ after conservative backlash
DeepMind and OpenAI Achieve Gold at ‘Coding Olympics’ in AI Milestone
SEC Allows Public Companies to Block Investors from Class-Action Lawsuits
Saudi Arabia Signs ‘Strategic Mutual Defence’ Pact with Pakistan, Marking First Arab State to Gain Indirect Access to Nuclear Strike Capabilities in the Region
Federal Reserve Cuts Rates by Quarter Point and Signals More to Come
Effective and Impressive Generation Z Protest: Images from the Riots in Nepal
European manufacturers against ban on polluting cars: "The industry may collapse"
Sam Altman sells the 'Wedding Estate' in Hawaii for 49 million dollars
Trump: Cancel quarterly company reports and settle for reporting once every six months
Turkish car manufacturer Togg Enters German Market with 5-Star Electric Sedan and SUV to Challenge European EV Brands
US Launches New Pilot Program to Accelerate eVTOL Air Taxi Deployment
Christian Brueckner Released from German Prison after Serving Unrelated Sentence
World’s Longest Direct Flight China Eastern to Launch 29-Hour Shanghai–Buenos Aires Direct Flight via Auckland in December
New OpenAI Study Finds Majority of ChatGPT Use Is Personal, Not Professional
Hong Kong Industry Group Calls for HK$20 Billion Support Fund to Ease Property Market Stress
Joe Biden’s Post-Presidency Speaking Fees Face Weak Demand amid Corporate Reluctance
Charlie Kirk's murder will break the left's hateful cancel tactics
Kash Patel erupts at ‘buffoon’ Sen. Adam Schiff over Russiagate: ‘You are the biggest fraud’
Homeland Security says Emmy speech ‘fanning the flames of hatred’ after Einbinder’s ‘F— ICE’ remark
Charlie Kirk’s Alleged Assassin Tyler Robinson Faces Death Penalty as Charges Formally Announced
Actor, director, environmentalist Robert Redford dies at 89
The conservative right spreads westward: a huge achievement for 'Alternative for Germany' in local elections
JD Vance Says There Is “No Unity” with Those Who Celebrate Charlie Kirk’s Killing, and he is right!
Trump sues the 'New York Times' for an astronomical sum of 15 billion dollars
Florida Hospital Welcomes Its Largest-Ever Baby: Annan, Nearly Fourteen Pounds at Birth
U.S. and Britain Poised to Finalize Over $10 Billion in High-Tech, Nuclear and Defense Deals During Trump State Visit
China Finds Nvidia Violated Antitrust Laws in Mellanox Deal, Deepens Trade Tensions with US
US Air Force Begins Modifications on Qatar-Donated Jet Amid Plans to Use It as Air Force One
Pope Leo Warns of Societal Crisis Over Mega-CEO Pay, Citing Tesla’s Proposed Trillion-Dollar Package
Poland Green-Lights NATO Deployment in Response to Major Russian Drone Incursion
Elon Musk Retakes Lead as World’s Richest After Brief Ellison Surge
U.S. and China Agree on Framework to Shift TikTok to American Ownership
London Daily Podcast: London Massive Pro Democracy Rally, Musk Support, UK Economic Data and Premier League Results Mark Eventful Weekend
This Week in AI: Meta’s Superintelligence Push, xAI’s Ten Billion-Dollar Raise, Genesis AI’s Robotics Ambitions, Microsoft Restructuring, Amazon’s Million-Robot Milestone, and Google’s AlphaGenome Update
Le Pen Tightens the Pressure on Macron as France Edges Toward Political Breakdown
Musk calls for new UK government at huge pro-democracy rally in London, but Britons have been brainwashed to obey instead of fighting for their human rights
Elon Musk responds to post calling for the murder of Erika Kirk, widow of Charlie Kirk: 'Either we fight back or they will kill us'
×