According to Forbes, the United States along with over 70 other countries has committed to implementing the OECD’s Crypto-Asset Reporting Framework (CARF) by 2029. The Treasury Department submitted proposed regulations to the White House on November 14, 2025, which are now under review before public release. Once implemented, foreign centralized crypto exchanges, brokers, and custodial wallet providers would be required to automatically report detailed information on US account holders to the IRS. This includes taxpayer names, addresses, year-end asset values, cost basis, gross proceeds from transactions, and certain transfers exceeding thresholds. The framework would essentially capture all cryptocurrencies, stablecoins, NFTs, and most tokenized assets unless they’re already covered by existing financial reporting standards.
The current reporting mess
Here’s the thing: right now, the IRS has almost no automatic visibility into foreign crypto accounts. The existing FBAR system still defines “financial accounts” as traditional bank and securities accounts – pure crypto holdings on foreign platforms arguably don’t count. And while Form 8938 under FATCA covers foreign financial assets, there’s no clear guidance about whether crypto qualifies. Basically, we’re in this weird gray area where tax professionals are advising clients to report foreign crypto anyway, but the rules haven’t officially caught up with the technology.
What CARF actually changes
CARF is basically the crypto version of the Common Reporting Standard that’s been exchanging bank data between countries for years. Under the OECD framework, Reporting Crypto-Asset Service Providers (RCASPs) would need to identify US taxpayers and send the IRS everything from transaction details to year-end balances. The big question mark? DeFi. There’s been speculation about exemptions for non-custodial protocols, but without the actual regulations being public, nobody really knows how Treasury will handle truly decentralized systems.
Why this matters right now
Look at the Roger Ver case – the so-called “Bitcoin Jesus” just paid $50 million in back taxes and penalties after being indicted for failing to report $240 million in Bitcoin held through foreign entities. His case shows how quickly unreported offshore crypto can escalate from paperwork errors to criminal exposure. And once CARF data starts flowing automatically, mismatches will be detected instantly. Civil FBAR penalties alone can reach 50% of the highest account balance per year. So if you’re holding crypto offshore, now’s the time to get your reporting in order before the automated systems start flagging everything.
