The US wants to close tax loopholes in the crypto sector. The US Treasury Department is calling for mandatory reporting of customer transactions by crypto exchanges.

The U.S. Treasury Department has issued a bill introduced to close tax loopholes in the crypto sector. Under the bill, crypto trading platforms would have to report detailed information about their customers' transactions to the Internal Revenue Service (IRS) starting in 2026.

According to the IRS, this should generate up to $28 billion in additional revenue over a 10-year period.

If the new rules go into effect, crypto brokers will have to track and report important information, such as clients' capital gains and losses. Similar to existing requirements for stock and bond brokers.

The vice president of taxes at U.S. crypto exchange Coinbase reacted with outrage. "The sheer scale of these data requirements would be hundreds of times larger than the transactions reported annually by a major brokerage firm and goes far beyond detecting tax fraud for high net worth individuals."

"The practical feasibility of requiring the IRS to report - let alone enforce - these incredible details of taxpayer data is questionable at best," he added.

Under the proposal, brokers would be required to report gross proceeds from the sale of digital assets beginning in 2026.

Decentralized crypto exchanges would also be affected. "This decision was made because the reasons for requiring information reporting on sales of digital assets does not depend on how an entity operating a platform affects customer transactions," the Treasury Department said.

The proposal is the latest attempt by the U.S. government to more strictly regulate the market for digital assets.