The IRS is finalizing new regulations regarding the taxation of cryptocurrencies

Cryptocurrency platforms will have to report transactions to the Internal Revenue Service from 2026. However, decentralized platforms that do not store assets themselves will be exempt from this obligation.

Here are the key takeaways from the new regulations that the IRS and the U.S. Treasury finalized on Friday — essentially implementing provisions of the Biden administration’s Infrastructure Investment and Jobs Act, which was passed in 2021.

Crypto holdings are taxable even without these new rules; however, there was no real standardization on how to report these holdings to the government and individual investors. Starting in 2026 (covering transactions in 2025), cryptocurrency platforms will be required to provide a standard Form 1099, similar to those sent by banks and traditional brokerages.

In addition to making it easier to pay taxes on cryptocurrencies, the IRS has also said it is trying to crack down on tax evasion.

“We must ensure that digital assets are not used to conceal taxable income, and these final regulations will improve the detection of regulatory noncompliance in the high-risk area of ​​digital assets,” IRS Commissioner Danny Werfel said in a statement.

But again, these regulations apply to “custodial” platforms (like Coinbase) that actually take customer assets. After lobbying from the cryptocurrency industry, decentralized brokers that do not take assets are excluded from these regulations.

In fact, the Blockchain Association (an industry lobbying group) called the exclusion “a testament to the incredibly powerful voice of our industry and community.”

The Treasury Department and IRS have announced that they will cover these decentralized brokers with a separate set of regulations.