Kraken Filed 56 Million Crypto Tax Forms in 2025 and Wants Congress to Raise the Bar

Kraken submitted 56 million crypto tax forms for 2025, most reporting gains under $50, and is now calling on Congress to overhaul what it calls an unworkable reporting threshold.

Kraken filed 56 million crypto tax forms with the IRS for the 2025 tax year, and the exchange says the volume exposes a fundamental flaw in how digital asset transactions are currently reported. Most of those forms covered amounts under $50. The exchange disclosed the figures in a public blog post and used them to make a direct case to Congress: the existing $10 minimum reporting threshold is too low and needs to change.

Kraken Crypto Tax Forms Flood the IRS With Low-Value Reports

Kraken’s filing volume for 2025 dwarfs what most traditional brokerages process, and the exchange says the numbers prove the current framework was not designed with crypto in mind. Under existing IRS rules inherited from traditional finance, crypto platforms must report transactions above $10. Kraken has argued that applying that standard to digital assets generates millions of low-value filings that add compliance costs without meaningful tax revenue gains. “The vast majority of these forms represent transactions so small they would never trigger reporting requirements in traditional markets,” Kraken said in its post.

Kraken Pushes Congress to Rewrite the Rules

Kraken is calling on Congress to establish a broad, inflation-indexed de minimis exemption that would eliminate reporting requirements for small crypto transactions, similar to frameworks already in place in countries like the United Kingdom. The exchange also wants lawmakers to give taxpayers the choice of when to be taxed on staking rewards, either at the point of receipt as current rules require, or at the point of sale. Kraken describes the current staking tax treatment as phantom income, because holders owe tax on tokens they have not sold, sometimes at values that exceed what the tokens are currently worth. CoinDesk reported that legislation already moving through Congress includes a de minimis provision, but it is currently limited to stablecoins and does not cover Bitcoin or other widely held digital assets.

Crypto Tax Reporting Remains a Flashpoint

Kraken’s push comes as the crypto industry continues to challenge IRS reporting rules on multiple fronts. Congress has already moved to repeal the controversial DeFi broker rule that would have required decentralized platforms to file the same reports as centralized exchanges, a rule critics called technically unworkable. The industry has also challenged IRS broker reporting definitions in court, arguing they were written without an understanding of how blockchain networks actually operate. For retail investors, the stakes are immediate. Millions of small holders who traded or earned staking rewards in 2025 may now face IRS reconciliation tasks for transactions measured in fractions of a cent.

Kraken said it plans to continue advocating for threshold reform as the broader crypto regulatory debate moves forward in Washington.