Global crypto tax reporting still has major cracks — and tokenized stocks may be the catalyst that forces the system to catch up.
In recent weeks, platforms like Robinhood and Gemini have started offering tokenized stocks to users in the European Union. These blockchain-based derivatives mimic the price of real equities like Apple and Tesla and allow users to trade 24/7, free from the limitations of traditional market hours.
That might sound like a leap forward for accessibility and innovation. But if these products continue to gain traction, and firms like Galaxy Digital believe they will siphon liquidity from traditional exchanges, regulators will face growing pressure to close the reporting gap between crypto platforms and traditional brokers.
Despite the progress the crypto industry has made over the years, crypto tax reporting is still far behind compared to traditional asset exchanges in many parts of the world.
There is still an obvious gap. Take Australia. The Australian Stock Exchange (ASX) provides the tax office with structured data, including sale prices, dates, and proceeds, which is automatically pre-filled into users’ returns.
For crypto, the ATO’s approach is more like a gentle tap on the shoulder to its taxpayers. It presents a notification reminding users to check for taxable events, rather than a detailed pre-filled report. While the ATO knows you are active in crypto because crypto exchanges report you have an account, it does not have the same comprehensive oversight as it does with stock trading.
That approach may have been justifiable in crypto’s early days, when most activity was tied to speculative tokens or NFTs. But now, with platforms likely wanting to expand their offerings of tokenized stocks globally — which are not yet available in Australia but I dare say it is being considered — the lack of tax transparency becomes much harder to justify.
Governments can’t afford to let potential tax revenue slip through the cracks simply because they’re happening onchain. I believe as tokenized stocks start to gain more and more attention over the coming months, regulators will be scrambling to ensure they are prepared.
In the U.S., the IRS is already attempting to catch up. Its new crypto reporting rules, including the long-awaited Form 1099-DA, are set to take effect in 2026. These will require crypto brokers to report user transactions similar to traditional financial institutions.
Meanwhile, Robinhood is reportedly preparing to launch tokenized stocks for U.S. customers.
It raises a timely question…will that rollout coincide with the new IRS requirements?
On a global scale, the OECD’s Crypto-Asset Reporting Framework (CARF), also due in 2026, will enforce transaction data sharing across jurisdictions, similar to how banks comply with the Common Reporting Standard.
If tokenized stocks are going to mimic real equities then the tax data reporting around them needs to match accordingly.
The days of crypto existing in a regulatory gray zone are numbered. Whether platforms are ready or not, the era of full tax transparency is coming and tokenized stocks may be the turning point that forces it into reality.
I believe that moment will arrive within the next five years.
