The U.S. Treasury Department released proposed regulations today that will address how cryptocurrency sales take place, part of growing efforts to regulate the trade of digital assets.

The Treasury Department’s new rules will define what the government means by “broker” in the crypto industry and will include cryptocurrency exchanges such as Coinbase Global Inc., the largest U.S. domestic exchange by volume. Certain decentralized finance operations that execute the exchange of assets would also be covered. Such operations would be required to disclose additional transaction data to the Internal Revenue Service.

The proposal noted that cryptocurrency miners, who validate transactions on the network to earn tokens as a reward, would be exempt from the rule, as they do not involve themselves in the exchange of currency.

This move from the Treasury and the IRS follows an expansion of regulatory interest in the U.S. over the need to regulate crypto assets given concerns about the effects of tax cheats and other fraud on the economy. The new requirements stem from the $1 trillion 2021 Infrastructure Investment and Jobs Act, which called for increasing tax reporting requirements for digital asset brokers.

At the time the infrastructure bill was passed, it was estimated that it would bring in about $28 billion over 10 years. However, this was published during the peak of the cryptocurrency markets, before the markets saw a broad decline in 2022 known in the industry as “crypto winter.” That said, regulators have noted that their interest is not purely revenue.

Under the current law, taxpayers must report their crypto transactions regardless of whether they have gains or losses, meaning that they must make arduous calculations and complicated calculations involving their cost basis on the purchase of their assets and the sale.

The new regulations create a tax reporting form called 1099-DA to help taxpayers determine how much they owe in taxes that would be filled out by brokers. This would also bring the operations in line with the same rules as other financial institutions that handle similar transactions such as bonds and stocks, the Treasury Department said.

“This is part of a broader effort at Treasury to close the tax gap, address the tax evasion risks posed by digital assets, and help ensure that everyone plays by the same set of rules,” Treasury said in a statement. “These regulations align tax reporting on digital assets with tax reporting on other assets, and, as a result, avoid preferential treatment between different types of assets.”

Under the new rules, the rule will become effective for the 2026 season to report on sales that occurred during 2025. With the long timetable set before the rules come into effect, exchanges and brokers such as Coinbase will have plenty of time to bring themselves into compliance.

Commenting on the proposed regulations, Blockchain Association Chief Executive Kristin Smith said in a statement it’s important that people who use crypto assets pay their taxes, but at the same time they do not operate the same as traditional financial instruments and should not be treated as such.

“If done correctly, these rules could help provide everyday crypto users with the necessary information to accurately comply with tax laws,” Smith said. “However, it’s important to remember that the crypto ecosystem is very different from that of traditional assets, so the rules must be tailored accordingly and not capture ecosystem participants that don’t have a pathway to compliance.”

Earlier this month, lawmakers called upon the Treasury to enshrine tighter rules to combat cryptocurrency tax evasion in a letter. “Given the chance, tax evaders and the crypto intermediaries willing to aid them will continue to game the system, exploit loopholes, and siphon off billions of dollars a year from the U.S. government,” wrote U.S. Senators Elizabeth Warren, Bob Casey, Richard Blumenthal and Bernie Sanders.

Currently these regulations are just a proposal and the Treasury Department is seeking feedback from the industry. The Treasury and the IRS are taking written comments until Oct. 30 and a public hearing has been scheduled for Nov. 7, with an extended hearing if the number of speakers is too large for one day to hear out comments.

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