Key Takeaways
- Only 14% of global taxable onchain crypto asset activity is estimated to fall within CARF’s scope.
- DEX activity, P2P transfers and self-custody transactions largely fall outside CARF’s scope.
- Expanding crypto-tax reporting could also create major privacy and security risks.
Last year, potentially taxable global onchain crypto asset activity surpassed $457 billion, blockchain intelligence company Chainalysis said in its latest report. Out of this sum, $125.1 billion is attributed to European countries, $112.6 billion goes to the U.S., and $21 billion is associated with China, where trading crypto assets onshore is banned.
These numbers, which are estimated to be a lower boundary, include gains attributed to centralized and decentralized exchanges; income from mining, staking, lending and gambling; and crypto asset-denominated payments. Meanwhile, when it comes to China, due to the trading ban, it’s hard to estimate total activity by Chinese users as transactions are being moved offshore.
An 86% Hole
In either case, per the analysts, CARF, or the Crypto-Asset Reporting Framework released by the OECD that comes into force next year, captures only 14% of the global total.
“The remaining 86% — encompassing DEX activity, peer-to-peer transfers, onchain income streams, and payments — falls outside the framework’s practical scope,” Chainalysis, which sells onchain activity tracking tools to governments and companies, said.
CARF, which is designed to function as a tax-related risk detection tool, applies only to centralized exchanges, brokers, retailers, and some wallet providers. At least 46 countries have already committed to implementing it in 2027 and to start collecting crypto asset user information and sharing it with other jurisdictions. Another 29 should join the group in 2028, while the U.S. will join in 2029.
What Is Still Hidden
The onchain analysts claimed that CARF will not catch the absolute majority of crypto asset-related taxable income because activity on decentralized exchanges, peer-to-peer transfers, self-custody activity, mining rewards, staking yields, lending income, and many goods/services payments aren’t captured by this net.
What’s more, exchanges lack information about crypto assets acquired elsewhere, making accurate gain/loss calculations difficult, while not all countries will participate in CARF. Additionally, the framework might tell a tax agency what a person sold their crypto assets for, but not what they paid for them, making it complicated to calculate the profit.
However, CARF is not the only recent attempt to improve the collection of crypto asset-related taxes. In the EU, where the DAC8 directive came into force this January, crypto exchanges are already collecting their customers’ sensitive personal data and will start sharing it with national tax authorities in 2027.
Life-Threatening Dangers of Tax Data Leaks
The fight against tax evasion is a double-edged sword, as it also puts crypto asset owners at risk.
This summer, bitcoin-only exchange Bull Bitcoin started a legal fight in France in an attempt to strike down the decree implementing DAC8 in local law. According to the exchange, which also develops the popular bitcoin wallet Bull, with multiple privacy-enhancing features, the EU directive creates “a massive international financial-data honeypot linking people’s legal identities, home addresses and crypto activity, including information with no relevance whatsoever to taxation.”
France has become infamous for having the most physical attacks on bitcoin and other crypto asset owners, which was also facilitated by personal data leaks from the national tax authority. In the first eight months of this year, per the public database of registered physical attacks on crypto asset owners, there were 36 incidents, or 64% more than for the whole of 2025. The number is likely higher, as not all attacks are reported to the police and/or become public.
