Morning Minute: The White House and IRS Target Foreign Crypto Holdings

Morning Minute is a daily newsletter written by Tyler Warner. The analysis and opinions expressed are his own and do not necessarily reflect those of Decrypt. Subscribe to the Morning Minute on Substack.

GM!

Today’s top news:

• Crypto majors chop ahead of NVDA earnings today; Bitcoin at $91,400
• Kraken raises $800M at $20B valuation led by Citadel
• Ethereum Foundation unveils “Interop Layer” where L2s function as 1 chain
• Fidelity launched its Solana ETF; SOL ETFs see most inflows since Nov 6
• MegaETH teases its mainnet beta will go live early December

🇺🇸 The IRS Targets Foreign Crypto

The Trump White House has been definitively positive on crypto and its need for regulation in the U.S.

And now we’re seeing one of the first major impacts, in a big crackdown.

📌 What Happened

The White House is reviewing a new IRS proposal that would require Americans to report and pay taxes on foreign crypto accounts.

The proposal includes rules modeled after FBAR and FATCA, the same frameworks used for offshore bank accounts.

This comes after Treasury pushed new reporting obligations for “digital asset accounts” held abroad, but the definition of foreign account is intentionally broad. It could include:

• offshore centralized exchanges
• foreign custodians
• foreign brokers that list tokenized assets
• potentially even certain wallet providers with offshore corporate entities

The proposal is complex, but the core idea is simple: if you’re a U.S. taxpayer and you hold crypto with any foreign entity, the IRS wants visibility and reporting.

🗣️ What Are They Saying

“Implementing CARF would discourage U.S. taxpayers from moving their digital assets to offshore digital asset exchanges. Implementing CARF would promote the growth and use of digital assets in the United States and alleviate concerns that the lack of a reporting program could disadvantage the United States or U.S. digital asset exchanges.” – previous White House statement

🧠 Why It Matters

Is this a big change?

Well, it depends on whether you’ve been paying your crypto taxes.

There are seemingly 4 cohorts of crypto taxpayers in the US:

• Those who pay everything on-chain and through DEXs so they can sleep at night
• Those who only pay tax on what gets off-ramped (the CEX tax)
• Those who don’t pay tax at all and risk it
• Those who don’t have any gains to pay taxes on

So this change really only affects cohort #2 above.

For those who have been playing by the book, taxes are always reported and paid on all transactions. But now, those who have been skirting some rules may have to re-evaluate their framework.

The rationale from the White House makes sense here. If they want crypto to grow in America, they also want it held in America (self-custodied or via centralized exchanges like Coinbase). It’s easier to track and regulate this way.

So closing the foreign loopholes makes sense, even though this is one unlikely to drive a big uptick in tax revenue. It’s more about the spirit of the statement.

America is open for business for crypto in 2025—so hold your crypto onshore.

🌎 Macro Crypto and Memes

A few Crypto and Web3 headlines that caught my eye:

• Crypto majors are slightly green ahead of a major NVDA earnings call tonight; BTC even at $91,300; ETH +2% at $3,090, BNB +1% at $922, SOL +1% at $139
• MYX (+38%), STRK (+30%) and ZEC (+10%) led top movers
• Bitcoin’s latest 30% drawdown happened much more rapidly (42 days) than the prior 2 from Summer 2024 (147 days) and April 2025 (77 days)
• Kraken raised $800M at $20B valuation, led by Jane Street, DRW, Oppenheimer and a $200M Citadel stake
• The Ethereum Foundation outlined goals for its upcoming Interop Layer which aims to unify all EVM L2s and make them “feel like one chain”
• The OCC said national banks may hold and spend crypto in specific cases (i.e. to pay for gas), for testing applications, and more
• New Hampshire launched the first Bitcoin-backed municipal bond
• Mt. Gox moved 10,608 BTC (nearly $1B) from a cold wallet to new addresses, renewing expectations that creditor repayments could be imminent
• Tether made a strategic investment in Ledn to expand bitcoin-backed lending

In Corporate Treasuries / ETFs

In Memes / On-chain Movers

• Meme coin leaders are mostly flat; DOGE +1%, Shiba -1%, PEPE -1%, PENGU -1%, BONK -1%, TRUMP +1%, SPX +10%, and FARTCOIN even
• A Hawk Tuah meme coin lawsuit added Haliey “Hawk Tuah” Welch as a defendant, alleging deceptive promotion
• The 67 meme coin ran to $40M and a new high; Bullish +125% and GIGA +38% other notable movers
• EDEL jumped 45% to $78M FDV as it tokenized stocks infra protocol takes off

💰 Token, Airdrop & Protocol Tracker

Here’s a rundown of major token, protocol and airdrop news from the day:

• MegaETH “Frontier” goes live early December as the official release of its mainnet beta
• Phantom introduced Phantom Terminal, with new charts, real-time data, and fast execution
• Myriad integrated the Walrus data layer enabling all market images and data to live immutably on-chain
• Obex raised $37M to incubate RWA-backed stablecoins
• Solomon Labs raised $102M in its Metadao presale, several multiples above its goal, opening at $0.8 and a $20M FDV; 92% of funds were refunded
• PVP announced an acquisition of Hyperdash, touted as the leading analytics platform on Hyperliquid

🚚 What is happening in NFTs?

Here is the list of other notable headlines from the day in NFTs:

• NFT leaders were slightly green; CryptoPunks +2% at 30.5 ETH, Pudgy even at 5.15, BAYC +2% at 6.14 ETH; Hypurr’s -5% at 724 HYPE
• A ripcache 1/1 ‘relic_01‘ sold for $125,000
• OpenSea revealed its Wave 2 treasure chests as rewards for its farming program