How the world taxes cryptocurrencies
Original title: Bitcoin, cryptocurrencies and tax evasion: A systematic literature review on global approaches to cryptocurrency taxation and the challenges for harmonising regulatory frameworks
Cryptocurrencies are decentralised and pseudonymous — which is precisely what makes taxing them hard. With my co-authors I went through 38 academic studies on how individual countries approach cryptocurrency taxation, looking for where they agree and where they do not.
Why it is worth reading
If you have ever wondered how profit from cryptocurrency is actually taxed, this review shows why there is no simple answer anywhere in the world.
What to take away
- Cryptocurrency taxation is not a solved problem. Countries approach it differently and the systems do not fit together.
- The difficulty is not only technical. It is genuinely hard to define what counts as a taxable event — and when it occurred.
- Fragmented rules create room for tax avoidance while also making life harder for people who want to pay correctly.
- Nothing changes without international cooperation. That is the main conclusion we reached.
Why this is a problem at all
When you sell a share at a profit, the system knows where the trade happened, who made it and in what currency. With cryptocurrencies none of that holds automatically. The network is decentralised, addresses are pseudonymous, and the transaction did not take place in any particular country.
Tax systems, meanwhile, rest on exactly the opposite assumptions: that a place, a person and a moment can all be identified.
What we did
With my co-authors I carried out a systematic literature review — so we did not collect our own data, but went through what others had found about cryptocurrency taxation. We critically analysed 38 academic studies using a predefined seven-step methodology and sorted them into ten thematic categories.
We were mainly interested in how individual jurisdictions approach the issue, what counts as a taxable event in each, and which compliance mechanisms they use.
What came out of it
Almost no agreement. The rules are fragmented and unharmonised — the point is not that some countries solved the problem better than others, but that the solutions do not talk to each other.
The consequence cuts both ways. Fragmentation creates room for avoiding tax, but it also makes life difficult for people who want to pay correctly and cannot work out on what basis.
What follows
Our conclusion is about what you would expect from a topic that crosses borders: coherent rules cannot be built at the level of a single country. That is not a striking answer, but it is the one the review supports.
More interesting is what it means for an ordinary person. If you are dealing with tax on cryptocurrency, there is no universal answer to be found on a forum — what applies is what your own jurisdiction says, and it may differ from the one next door.
This text is a plain-language summary of an academic study and serves educational purposes. It is not tax or investment advice.
Bibliographic details
- Authors
- Eva Kicova, Juraj Fabus, Natalia Stalmasekova, Terezia Kvasnicova-Galovicova
- Published in
- Data Science in Finance and Economics
- Year
- 2025
- Volume
- 5
- Issue
- 2
- Pages
- 234-257
- Publisher
- American Institute of Mathematical Sciences (AIMS)
- DOI
- 10.3934/dsfe.2025011
- Keywords
- Bitcoin, blockchain and taxation, cryptocurrencies taxation, jurisdictional Bitcoin comparisons, regulatory frameworks
Show abstract
Official abstract in its original wording.
Taxing Bitcoin and other cryptocurrencies presents a significant challenge due to their decentralised and pseudonymous nature, complicating enforcement and fostering regulatory inconsistencies across jurisdictions. This study systematically reviews the existing literature on cryptocurrency taxation, critically analysing 38 academic studies to identify key themes, challenges, and gaps in global regulatory frameworks. Using a structured seven-step methodology, it examines how jurisdictions approach cryptocurrency taxation, highlighting ten thematic categories, including jurisdictional comparisons, taxable events, and compliance mechanisms. The findings reveal persistent regulatory fragmentation and a lack of harmonisation, underscoring the need for international cooperation to establish coherent tax policies. By synthesising existing research and identifying unresolved issues, this study contributes to the discourse on balancing technological innovation with fiscal accountability, ultimately advocating for a unified, cross-border approach to cryptocurrency taxation.
Cite
Kicova, E., Fabus, J., Stalmasekova, N., & Kvasnicova-Galovicova, T. (2025). Bitcoin, cryptocurrencies and tax evasion: A systematic literature review on global approaches to cryptocurrency taxation and the challenges for harmonising regulatory frameworks. Data Science in Finance and Economics, 5(2), 234-257. https://doi.org/10.3934/dsfe.2025011