Exploring global tax compliance for crypto assets, from cross-border income to personal tax planning, and delving into the tax logic of scenarios such as DeFi, mining, and airdrops. This article is derived from a piece written by FinTax, organized, translated, and authored by Deep Tide TechFlow. (Background: GENIUS compliant stablecoin = re-skinned CBDC? Experts warn: comprehensive monitoring destroys the spirit of decentralization) (Background information: Robinhood reveals that many private companies are preparing to issue 'tokenized US stocks'; CEO: Robinhood can meet the highest compliance standards). During this discussion, the global regulatory compliance heat for crypto assets continues to rise, with countries strengthening tax information exchange and tracking for on-chain assets, overseas accounts, and cross-border transactions. In this discussion, Calix and William combined their cross-border tax operational experiences and on-chain business experiences to discuss hot topics including global tax compliance for crypto assets, tax arrangements, and regulatory gamesmanship. The two discussants also shared their visions for an ideal Web3 tax system and discussed tax logics in various scenarios such as exchange compliance, DeFi, mining, and airdrops, using real cases. Who should cross-border income be taxed to? Calix: I want to start with a 'soul question.' You usually engage in mining, and the company sometimes pays bonuses in cryptocurrency. How do you usually fulfill your tax obligations for such income? William: This is a very practical question. I very much agree with a point you mentioned before: since we enjoy the infrastructure and business environment provided by a certain country or region, fulfilling tax obligations is reasonable. But the reality is not that simple. Our company's clients are distributed across multiple markets in North America, Europe, the Middle East, etc., and this income relies on conditions provided by multiple places, making it difficult to attribute it entirely to one location. Although I mainly deal with American clients and most of the income comes from the American market, it is actually quite difficult to determine to whom this tax should be paid. Overall, I am willing to pay taxes, but for this type of income, it is indeed not easy to clarify who the money should go to. After all, the formation of this income does not entirely depend on where I am. Calix: I think your answer indeed touches on the key point. The Web3 project itself is transnational and cross-regional, making it very difficult to accurately attribute income to a specific place. Economic activities are closely related to customer sources, as well as the platforms, networks, and infrastructures used. Therefore, the question of who should ultimately pay this tax is indeed worthy of in-depth discussion. To be honest, although I have been doing tax-related work for many years, I have also been confused about this issue myself. According to current tax laws, I might be a tax resident in the mainland, and I might also be subject to tax obligations in Singapore, but my business mainly targets North America, and sometimes I receive compensation through a Hong Kong company. If I strictly follow tax law, the surface answer may be clear, but discussing what approach is more reasonable is indeed worth pondering. For Web3 practitioners, these discussions often transcend the traditional tax framework that can be completely covered. William: That's right, I think the core issue is that the evolution speed of the global tax regulatory system is indeed difficult to keep up with the pace of technology and industry development. Regulation has been trying to catch up, but industry changes and technological innovations are always ahead. This state of being 'chased' may persist for a long time, and there will always be a dynamic balance between regulation and industry. Case discussion: Tax supplement for individuals trading coins in mainland China. Calix: Recently, there have been two hot topics in the Chinese Twitter area, one of which is an announcement from the Zhejiang Taxation Bureau stating that an individual is required to pay a tax supplement due to trading coins. Later, we learned through some channels that it was actually after CRS information exchange, the tax bureau discovered an unusual balance in his overseas bank account and asked him to explain the source of funds. He explained that this part was investment income, so he needed to pay a tax supplement, and this investment happened to involve cryptocurrencies. For me, this kind of case is not surprising; after all, this is my professional field, so I think it's normal and representative. William, you have been involved in on-chain projects like DeFi and mining; how do you view this case? William: It is indeed very representative. We actually judged early on that trading coins would eventually fall under the tax scope. But when this actually happens around us, especially for many Chinese people, the impact is still quite significant. Traditional DeFi or some purely on-chain activities have always been difficult to regulate, often relying on user awareness. In the past, there have indeed been some regulatory barriers, resulting in tax authorities not having particularly strong enforcement power over these relatively niche, decentralized, and difficult-to-trace on-chain activities. I think the reason why this is happening so 'timely' now is also related to other trends in the industry. Recently, there have been many reports showing that some US stock investors have received text messages or phone calls asking for tax supplements, indicating that regulators are beginning to more closely track individuals' overseas income, with the first cut being overseas securities investments. The logic behind this is also very clear: the intersection between US stocks and the crypto world is increasing. From Robinhood to Asian brokers like Tiger Brokers and Futu, even Guotai Junan International, many brokerages are dealing with crypto assets, making it increasingly difficult to separate US stocks from crypto assets. Once we look at overseas income comprehensively, as long as we check US stocks, it is easy to also include the crypto world, especially since the scale of crypto assets is already significant. Moreover, this 'combination of stocks and coins' is not a short-term phenomenon. For example, in the US, some companies are trying to tokenize US stock; in Asia, conversely, they will package crypto assets into listed companies to drive stock prices, obtain premiums, and promote secondary market performance. The interests driving this combination, whether 'stocks turning into coins' or 'coins being packaged as stocks,' will further strengthen the connection between the two, naturally making 'trading coins needing to pay taxes' inevitable. Overall, the crypto asset market and the stock market are highly intertwined. As this trend continues to develop, the tax issues surrounding trading coins will become increasingly rigid, and the space for evasion will become smaller and smaller. Calix: This perspective is indeed quite novel; I had not thought deeply about it from the 'stock-coin linkage' angle before. After all, for stock investments, people are already accustomed to where the money is made and where to pay taxes, whether it is capital gains tax or business income from quantitative investments; the framework is relatively clear. However, when it comes to cryptocurrencies, some regions, especially the mainland, indeed have gray areas regarding 'whether to pay taxes and what taxes to pay.' However, looking at the evolution of businesses involving stocks and tokens, this line of reasoning is actually quite enlightening and reminds everyone that this is a new issue that needs long-term attention. The long-term game of regulation and tax evasion. William: Based on your many years of frontline tax operational experience, now that this has been initiated, do you think some people will start avoiding cryptocurrencies out of concern for tax risks? Or will there still be people who want to evade taxes despite the risks, or even simply not report taxes, continuing to operate heavily in the crypto world? What impact will this have on the overall industry trend? Calix: This is a very typical real-world issue. I have always believed that regulation and 'anti-regulation' exist simultaneously; this is not only a characteristic of the crypto world but also of traditional industries. For tax authorities or any regulatory agency, they certainly want to collect the taxes due as completely as possible; from the taxpayer's perspective, regardless of the region, everyone hopes to legally minimize taxes or reduce their tax burden, and these two demands are inherently opposing. From my experience, this dynamic is very similar to...