AbstractThis report highlights key tax and regulatory developments in the global crypto asset industry during the first half of May 2025. Tax Updates:In the United States, significant changes are underway in how crypto assets and capital gains are taxed. The Missouri state legislature has passed a bill that would make Missouri the first state to exempt capital gains taxes on stocks, real estate, and crypto assets. At the federal level, former President Donald Trump has proposed a new 39.6% tax bracket for individuals earning over $2.5 million annually and has reiterated his plan to eliminate the carried interest tax break. Additionally, two U.S. senators have called on the Treasury Department to clarify the treatment of crypto assets under the corporate alternative minimum tax (CAMT), arguing that taxing unrealized gains would be unfair. Regulatory Updates:Governments and regulators worldwide are moving forward with efforts to bring the crypto market into greater compliance. The European Union plans to ban privacy coins and anonymous crypto transactions entirely by 2027 and to extend anti-money laundering (AML) rules to cover crypto asset transfers. In South Korea, new regulations will permit non-profit organizations to sell virtual assets under specific conditions, aiming to enhance market transparency. Meanwhile, the U.S. Securities and Exchange Commission (SEC) is exploring regulatory reforms to enable companies to issue, trade, and settle securities on blockchain networks. The SEC is also considering easing crypto custody requirements for broker-dealers, potentially giving hedge funds more operational flexibility. Part I Tax

1.Missouri May Eliminate Capital Gains Tax on Crypto and Stocks（5.8）

Missouri could become the first U.S. state to eliminate capital gains taxes. A new bill stipulates that capital gains from the sale of stocks, real estate, and other assets would no longer be subject to state income tax. The legislation passed the Missouri legislature on May 7 and has been sent to the governor’s desk. If signed, it will become law. Click here to read the original article

2.Trump Seeks Tax Hike on Wealthy Americans Earning Over $2.5 Million (5.9)

According to sources, President Donald Trump is pushing to raise taxes on some of the wealthiest Americans to offset other tax cuts included in his signature economic plan. His proposal calls for a new tax bracket of 39.6% for individuals earning at least $2.5 million annually or couples earning $5 million. If approved by Congress, this would restore the top tax rate to the level it was before Trump’s 2017 tax cuts. The current top individual tax rate stands at 37%. Trump reportedly made this request during a phone call with House Speaker Mike Johnson on Wednesday, where he also reiterated his desire to eliminate the carried interest tax loophole enjoyed by venture capital and private equity fund managers.Click here to read the original article

3.Two U.S. Senators Urge Treasury to Clarify Crypto Tax Rules to Avoid “Unfair Taxation”(5.14)

On May 12, 2025, U.S. Senators Cynthia Lummis and Bernie Moreno sent a letter to Treasury Secretary Scott Bessent, urging the Treasury to exempt unrealized gains on digital assets from the calculation of Adjusted Financial Statement Income under the Corporate Alternative Minimum Tax. They expressed concern that, without such guidance, U.S. companies might be compelled to sell digital assets to meet tax obligations, potentially hindering innovation and placing them at a competitive disadvantage compared to foreign firms. Click here to read the original articlePart II Supervision

1.European Crypto Initiative Introduces Compliance Guidelines for Crypto-Asset Service Providers（5.2）

The European Crypto Initiative (EUCI) has ushered in a transformative phase for cryptocurrency regulation with the release of The AML Handbook: A Guide forCrypto Activities. This comprehensive guide introduces 13 pivotal compliance pillars that crypto-asset service providers (CASPs) must adopt to align with the European Union’s stringent anti-money laundering (AML) framework. From banning anonymous accounts to implementing centralized tracking systems, these rules mark a decisive shift toward aligning crypto compliance with the rigor of traditional finance. Click here to read the original article

2.South Korea Permits Nonprofits and Exchanges to Sell Virtual Assets（5.5）

According to a recent announcement by South Korea’s Financial Services Commission (FSC), starting in June 2025, nonprofit organizations and cryptocurrency exchanges in South Korea will be permitted to sell virtual assets. This measure aims to regulate the crypto asset market, prevent price manipulation, and ensure market stability. The FSC also plans to implement customer verification measures by May 2025 to strengthen oversight of transactions between nonprofits and exchanges. Additionally, only virtual assets listed on at least three Korean won-based exchanges will be eligible for donations and trading, and all received assets must be liquidated immediately to ensure proper use of donated funds. Click here to read the original article

3.EU Plans to Track Crypto Transfers Under New AML Rules（5.9）

The European Union plans to track cryptocurrency transfers as part of its updated anti-money laundering framework. Speaking at the 2025 European Anti-Financial Crime Summit yesterday, Donohoe—who also serves as Ireland’s Minister for Finance—stated that the EU is working to apply longstanding anti-money laundering regulations to the crypto sector. Specifically, he explained that the EU aims to “record data on the sender and recipient of funds, which now applies to crypto-asset service providers.” Donohoe emphasized that extending AML regulations is “critical,” adding that the EU seeks to go “beyond traditional forms of financial transfers” and achieve “greater transparency in crypto-asset transfers.” Click here to read the original article

4.SEC Proposes Regulatory Sandbox for Tokenized Securities（5.9）

U.S. Securities and Exchange Commission (SEC) Commissioner Hester Peirce stated that the SEC is considering a potential exemptive order that would allow companies to issue, trade, and settle securities using distributed ledger technology (DLT), and permit the use of innovative trading systems to trade eligible tokenized securities.Click here to read the original article

5.U.S. Senators Urge Probe into Binance's Ties with Trump Family Crypto Ventures（5.9）

On May 9, 2025, U.S. Democratic Senators Elizabeth Warren and Chris Van Hollen sent a letter to the Treasury and Justice Departments, urging an investigation into cryptocurrency exchange Binance's ties with Trump family-linked digital asset ventures. They expressed concerns over a $2 billion investment by an Abu Dhabi firm in Binance, facilitated through the USD1 stablecoin issued by Trump-backed World Liberty Financial. The senators questioned whether this deal violated Binance's 2023 settlement with U.S. authorities over anti-money laundering and sanctions breaches and inquired if Binance sought a pardon for its former CEO, Changpeng Zhao. This move underscores growing apprehension about potential conflicts of interest involving President Trump's involvement in the cryptocurrency sector. Click here to read the original article

6..SEC Chair Paul Atkins: Crypto Broker Rules May Face Overhaul（5.13）

SEC Chair Paul Atkins said the current rules allowing brokers to custody digital assets may need to be replaced. He revealed the agency is considering letting hedge funds self-custody crypto, aiming to reform outdated regulations. Currently, only two firms in the U.S. have “special purpose broker-dealer” licenses. Speaking at a digital asset roundtable, Atkins blamed low industry participation on “major restrictions” from the previous administration. He stressed that broker-dealers were never barred from holding crypto assets, whether securities or not. However, he noted that the SEC may need to clarify how customer protection and capital requirements apply. Atkins has tasked SEC staff with exploring a new regulatory path, including possible changes to custody rules that could enable hedge funds, trading firms, and investment advisers to manage their own digital asset holdings. Click here to read the original articleRecommended Reading

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