Article: Crypto Staking Taxation Across Selected Countries: A Critical Evaluation

Abstract

The objective of this article is to evaluate countries’ approaches to the taxation of crypto staking by testing the consistency of current domestic rules and guidance against the technological substance of the same phenomenon. After the outline of the economics of crypto staking, the author provides evidence of the debate in tax literature and the regulatory landscape across selected countries. Subsequently, the research explores the technology features of staking and its fundamental variables of legal characterization, income qualification, and timing and value of income recognition. This way, the interdisciplinary methodology aims to outline a model of taxation reflecting the technological substance of crypto staking and test it against the current tax framework at the domestic level. The results of the analysis process show that the approach to the taxation of staking rewards does not ensure consistency with the technological substance in all of the selected countries. National tax authorities rely more on policy considerations aimed at maximizing revenue collection when developing guidance in the field than on the idea of coherent tax treatment in accordance with the technological substance and the legal characterization of the different types of staking activities. Tax & Technology, Blockchain, Cryptocurrencies, Proof-of-stake, Staking rewards, Direct staking, Indirect staking, Legal characterization, Income qualification, Time of income recognition