UK Introduces New Crypto Reporting Guidelines to Enhance Transparency

According to ShibDaily, the UK government has announced new guidelines mandating crypto firms to collect and report comprehensive data on customer trades and transfers. This initiative aims to enhance transparency and improve tax compliance within the cryptocurrency sector. The guidelines, issued by HM Revenue and Customs (HMRC), will require the mandatory collection of user and transaction data starting January 1, 2026. However, the government is urging companies to begin gathering this information ahead of time to ensure a seamless transition to the new reporting standards. Crypto firms will be obligated to collect and report detailed information for each transaction, including the user's full name, home address, and tax identification number. Additionally, the type of cryptocurrency used, the amount transferred, and identifying details of entities such as companies, trusts, and charities involved in crypto transactions must also be disclosed. This move is part of the UK's adoption of the Organisation for Economic Development (OECD) Cryptoasset Reporting Framework (CARF), which is being extended to include domestic reporting. Firms that fail to comply with these new requirements or submit inaccurate information may face penalties of up to £300 (approximately $398) per user. Depending on the type of data collected, crypto companies may also be required to submit annual reports to HMRC. In late April, UK Chancellor Rachel Reeves introduced a proposed framework for regulating crypto assets, marking a significant step towards strengthening consumer safeguards and boosting trust in the digital asset market. The draft legislation aims to bring more oversight to the rapidly evolving crypto space. Reeves stated in an April 29 official press release that firms offering services for cryptoassets like Bitcoin and Ethereum will be subject to new, clear rules, which are expected to boost investor confidence and drive growth through the Plan for Change. The proposed legislation builds on the UK Treasury's 2023 consultation, which outlined a strategy to bring a broad range of crypto-related activities—such as trading platforms, wallet providers, and crypto lending—under formal financial regulation. This initiative reflects the government's push to align the crypto sector with existing financial standards, aiming to reduce risks for consumers and establish clearer compliance expectations for industry participants. As the UK moves to integrate digital assets into its financial oversight framework, industry participants will be closely monitoring how these evolving regulations will shape the future of crypto in the region.