New research suggests 99% of crypto investors avoid paying taxes

A new study by a Swedish tax consulting startup suggests that nearly all crypto investors fail to report their digital asset gains to local authorities. However, other research shows different results.


Divly, a crypto tax platform provider from Sweden, released a study concerning tax compliance in the crypto industry. The research suggests almost everyone in the business avoids paying duties on their digital asset gains. The company estimates that globally as few as 0.53% of crypto investors declared their cryptocurrency profits to local tax authorities in 2022.

The crypto tax payment ranking is topped by Finns, with slightly over 4% of investors fulfilling their tax duties. Australia comes second, while Canada and the US hold, respectively, the ninth and tenth positions. The bottom of the ranking is occupied by Asian countries: India, Indonesia, and the Philippines. However, the table includes only 24 countries, mostly European, and overall data is too scarce to draw any serious "geographical" conclusions.

Crypto taxation researcu
Source: Divly

It's worth noting that the United States – not the top performer in the table above – leads the ranking of the countries with the most cryptocurrency taxpayers, followed by Japan and Germany. According to the report, in 2015, less than 900 US citizens reported their cryptocurrency to the IRS, even though over 5.9 million accounts were active on the Coinbase exchange alone. Over the years, the number of filings grew, but so did the number of investors.

Read also: Navigating the World of Cryptocurrency Investments: Expert Advice for Professional Investors

Divly's study doesn't align with other research in the cryptocurrency tax compliance area. Cointracker's 2022 survey showed that 4% of crypto investors reported cryptocurrency gains at the time when 40% of individual returns had already been filed. A year before, Coinledger released survey results indicating 50% compliance based on respondents' declarations.

A vast discrepancy between Divly's and the above-quoted studies makes it hard to estimate the actual tax compliance in the crypto industry. It's also safe to say the research from Divly is based on dubious methodology.

The company used a combination of government figures and... search volume data as a proxy for estimating the number of crypto taxpayers in the countries that didn't provide official numbers. Then Divly calculated the tax payment rate by comparing the estimated numbers of crypto taxpayers in each country covered in the report to the total number of crypto investors based on data from Statista. The company itself acknowledges the limitations of such an approach.

The bottom line is that we don't really know how many individuals and companies pay taxes on crypto. Nevertheless, it's reasonable to assume the numbers are higher than those provided by the study. Last but not least, the research is likely to be biased in light of the fact that Divly provides crypto tax-related solutions.