The US Treasury is finalizing cryptocurrency regulations to prevent tax avoidance

While people who own and sell cryptocurrencies have always had to pay taxes on their earnings, new regulations finalized by the U.S. Treasury Department could ensure they pay the right amount on their sales. The new regulations will require cryptocurrency platforms, such as exchanges and payment processors, to report their users’ transactions to the Internal Revenue Service. According to Wall Street JournalAuthorities hope the measure will discourage tax evasion because the IRS will know exactly how much a taxpayer owes.

At the same time, the rule will make it much easier for people to report their earnings, as their brokers will now have to provide them with a Form 1099. The IRS released a draft of the Digital Asset Proceeds From Broker Transaction (1099-DA) form designed specifically to track cryptocurrency transactions last year and will release the final version soon. Notably, the rule sets a $10,000 threshold for reporting transactions involving stablecoins, which are cryptocurrencies that track fiat money like the U.S. dollar.

“(I)nvestors in digital assets and the IRS will have better access to the documentation they need to easily file and review their tax returns,” Aviva Aron-Dine, acting assistant secretary of the Treasury for tax policy, said in a statement. “By implementing the Act’s reporting requirements, these final regulations will help taxpayers more easily pay the taxes they owe under current law while reducing tax avoidance by wealthy investors.”

The new rule will only apply to platforms that seize digital assets, such as Coinbase and Binance. It does not include decentralized ones, which will have to be subject to a separate rule due to be finalized later this year. Brokers will have to start reporting revenues from digital asset sales in 2026 for all transactions completed in 2025, which means cryptocurrency traders will still be on their own in 2024.