FBAR Requirements for Crypto Accounts Over $10,000: What You Need to Know in 2025

If you hold cryptocurrency on a foreign exchange and your total balance ever hit $10,000 in 2024, you might be at risk - not from a market crash, but from the IRS. Yes, even if you didn’t sell a single coin, you could still owe a filing. The rules around FBAR and crypto are confusing, inconsistent, and changing fast. And if you’re holding crypto on Binance, KuCoin, or another non-U.S. platform, you need to understand exactly where you stand.

What Exactly Is an FBAR?

FBAR stands for Foreign Bank and Financial Account Report. It’s not a tax form. It’s a disclosure form. You file it with FinCEN, not the IRS, using FinCEN Form 114. The rule is simple: if you’re a U.S. person (citizen, green card holder, or resident alien) and you had more than $10,000 in foreign financial accounts at any point during the calendar year, you must file.

"Foreign" means outside the United States. So if you have crypto on Binance.com (based in Malta), KuCoin (based in Seychelles), or Bitfinex (based in Hong Kong), those count as foreign accounts - even if you never touched a bank account.

The $10,000 threshold isn’t per account. It’s the total of all your foreign accounts combined. So if you have $4,000 on Binance, $3,500 on KuCoin, and $2,800 on a crypto wallet tied to a foreign exchange, you’ve hit the threshold. One day. That’s it.

Right Now: Crypto Accounts Are (Mostly) Exempt

Here’s where it gets messy. As of 2025, FinCEN has a clear rule: pure cryptocurrency accounts aren’t reportable on FBAR - unless they also hold fiat currency.

This comes from FinCEN Notice 2020-2, which says: "A foreign account holding virtual currency is not reportable on the FBAR (unless it is a reportable account under 31 C.F.R. 1010.350 because it holds reportable assets besides virtual currency)."

So if your account holds only Bitcoin, Ethereum, Solana, or any other crypto - and nothing else - you’re not legally required to report it right now. That’s the official position.

But here’s the catch: hybrid accounts are a different story. If your foreign exchange account holds both crypto and USD, EUR, or any fiat currency - even a few dollars - then it’s reportable. That’s because the fiat currency makes it a traditional financial account under FBAR rules. And once it’s reportable, the entire account counts toward the $10,000 threshold.

Why People Are Still Reporting Anyway

You might be thinking: "If it’s not required, why bother?"

Because FinCEN has said they’re coming for crypto.

FinCEN Notice 2020-2 doesn’t just say crypto isn’t reportable - it says, "At this time." That’s a red flag. The agency has been pushing for years to bring crypto under FBAR rules. Experts at CoinLedger, Bitwave, and major crypto tax firms agree: regulatory changes are coming, likely within the next 12-24 months.

Some tax professionals - especially those who work with high-net-worth crypto holders - recommend filing anyway. Why? Because if the rules change and they’re applied retroactively, you could face penalties for not reporting past holdings. Penalties for willful FBAR violations can hit $100,000 or 50% of the account balance - whichever is higher. That’s not a risk most people want to gamble with.

One investor in Austin, Texas, held $18,000 in Bitcoin on Binance in 2023. He didn’t file. In early 2025, his CPA told him to file an amended FBAR for 2023 and 2024. "I didn’t think I had to," he said. "Now I’m paying $1,200 to fix it. I wish I’d just filed in the first place."

How to Calculate Your Crypto Account Value

You can’t just look at your balance on December 31. You need to find the highest value your foreign crypto accounts reached at any single point during the year.

Let’s say you bought $9,000 worth of ETH in January. In March, ETH spiked and your account hit $14,000. Then it dropped back to $8,000. Even though you ended the year with less than $10,000, you still had to file because you hit $14,000 in March.

Tracking this manually is a nightmare. You need daily balance records in USD. Most people use crypto tax software like Koinly, CoinTracker, or TokenTax. These tools pull data from exchanges, track price history, and flag when your foreign accounts crossed the $10,000 threshold.

Without software, you’re stuck downloading monthly statements, checking historical prices on CoinGecko, and doing math by hand. It’s doable - but error-prone.

What If You Don’t File?

The IRS doesn’t automatically know about your foreign crypto accounts. They don’t get direct feeds from Binance or KuCoin. But that’s changing.

Under the 2021 Infrastructure Law, crypto exchanges are now required to report transaction data to the IRS. That includes transfers between wallets and exchanges. If you’re moving crypto from a U.S. exchange to Binance, that’s now visible to the IRS.

Also, the IRS has been running crypto compliance campaigns since 2022. Thousands of people received letters asking, "Did you file FBARs for foreign crypto accounts?" Many didn’t know they were supposed to. Now they’re facing audits.

Non-willful violations (meaning you didn’t know you had to file) can still cost $10,000 per year. Willful violations? Up to $100,000 or half your account balance. And if you’re caught hiding crypto to avoid reporting? That’s tax evasion - a felony.

What You Should Do Right Now

There’s no one-size-fits-all answer. But here’s what the experts recommend based on your situation:

• If you have hybrid accounts (crypto + fiat): File your FBAR. You’re legally required to.
• If you have pure crypto accounts and your balance went over $10,000: Consider filing anyway. It’s a low-cost way to protect yourself from future penalties. The form takes 30 minutes to file online.
• If you’re unsure: Keep detailed records. Save screenshots of your balances, transaction histories, and exchange statements. You’ll need them if the rules change or if you get audited.
• If you’ve never filed and you’ve held over $10,000: Don’t panic. You can file late using the IRS’s Streamlined Filing Compliance Procedures. You’ll pay no penalty if you can prove you didn’t know you had to file.

Most people who file late for the first time get a pass - if they come forward voluntarily. The IRS wants compliance, not punishment. But they won’t wait forever.

The Big Picture: This Is Just the Beginning

The U.S. government is moving fast to regulate crypto. The FBAR exemption is temporary. It’s not a loophole - it’s a pause.

FinCEN is working on new rules that will likely require FBAR reporting for all foreign crypto accounts by 2026. The Treasury Department has already signaled this in public statements. When it happens, it won’t be retroactive - but it might be. And if you didn’t keep records, you’ll be in trouble.

Right now, the safest move is to treat your foreign crypto accounts like bank accounts. Track them. Know your balances. File if you’re close to the $10,000 line. It’s not about fear. It’s about control.

Don’t wait until the IRS knocks on your door. File now. Save your records. Stay ahead. The rules will change - but your responsibility won’t.

Next Steps: What to Do Today

1. List every foreign crypto exchange you’ve used in 2024. Include Binance, KuCoin, Bybit, Bitfinex - even if you haven’t used them in months. 2. Use crypto tax software to find the highest balance in each account during the year. 3. Add up the maximum values. If the total is over $10,000, consider filing - even if you’re not legally required. 4. Save all your records: screenshots, transaction logs, exchange statements. Store them in a secure folder. 5. If you’re unsure, talk to a CPA who specializes in crypto. Don’t rely on a general tax preparer - they might not know the rules.

The rules around crypto and FBAR are still evolving. But one thing won’t change: the IRS will find out. Whether you file now or later, the best time to act is today - not when the audit letter arrives.