Chainalysis Finds Most On‑Chain Crypto Activity Falls Outside Current Tax Reporting Rules

Chainalysis’ August 2025 crypto‑tax report estimates that globally, potentially taxable on‑chain activity exceeded $457 billion in 2025. Only $64 billion – roughly 14 % – of that activity is likely to be reported under the OECD’s Crypto‑Asset Reporting Framework (CARF), leaving a large gap for tax authorities.

Breakdown of the $457 Billion Estimate

• United States leads with $112.6 billion, split into $64.6 billion in payments, $30.1 billion in gains and $17.9 billion in income.
• North America totals $134.6 billion, followed by the European Union at $125.1 billion and East Asia at $54.7 billion.
• Other notable countries: Germany $24.1 billion, China $21 billion, United Kingdom $19.4 billion, India $19 billion, Brazil $16.1 billion, Canada $15.1 billion, Japan $13.2 billion, Russia $13 billion, Thailand $12.5 billion.

Why 86 % Remains Uncovered

The uncovered portion includes activity on decentralized exchanges, peer‑to‑peer transfers, on‑chain income (mining, staking, lending, gambling) and crypto payments that do not pass through regulated intermediaries. Centralized‑exchange trades, internal staking and lending are excluded because they do not appear on public blockchains.

Limitations of CARF

CARF, launched by the OECD in 2022, requires crypto‑asset service providers—mainly centralized exchanges and brokers—to collect and share customer data. Data collection began on 1 January 2026 in 48 jurisdictions, with information exchange slated for 2027‑2029. Because the framework relies on intermediaries, it does not capture most DeFi activity or private‑wallet transactions.

Potential Tools for Tax Authorities

Chainalysis suggests that blockchain analysis can help fill gaps by tracing token movements, identifying interactions with decentralized protocols, and reconstructing cost‑basis information when assets move between wallets before reaching a reporting exchange.

Implications for the United States

U.S. tax guidance treats crypto disposals, swaps and spending as taxable events, while mining and staking rewards count as ordinary income. Custodial brokers began filing Form 1099‑DA for 2025 disposals, reporting gross proceeds first and cost basis from 2026 onward. The firm estimates the U.S. crypto tax gap at roughly $50 billion annually in 2022, with projected revenue of $28 billion over ten years from Form 1099‑DA filings.