Core Insights - Monero (XMR) is positioned to potentially outperform in 2026, following Zcash (ZEC) as a notable player in the privacy coin market [1] - XMR's stable on-chain transaction demand over the years provides a solid foundation for long-term growth, contrasting with the volatility seen in ZEC and DASH [2][3][4] - Strong and consistent developer activity around Monero, supported by a decentralized community, helps mitigate risks associated with centralized governance, which is a concern for ZEC [5][6][7] - The increasing demand for privacy due to new crypto tax reporting frameworks, such as the EU's DAC8 directive, is expected to drive interest in Monero [9] Transaction Demand - XMR has maintained stable transaction counts over several years, unlike ZEC and DASH, which experienced a surge followed by a sharp decline in Q4 2025 [3][4] - This stability in transaction volume indicates a solid foundation for XMR's growth and user engagement [4] Developer Activity - Monero's decentralized structure allows for strong developer engagement, with a record of 400 weekly core developer commits noted in late December [7][8] - This high level of developer activity is seen as a positive signal for potential investors, indicating ongoing commitment to the protocol [8] Privacy Demand - The introduction of the DAC8 directive in the EU, effective January 1, 2026, mandates detailed reporting of user and transaction data, which is likely to increase the demand for privacy-focused assets like Monero [9]

Core Insights - A significant majority of crypto traders in the U.S. are not fully reporting their digital asset income to the IRS, indicating a potential increase in enforcement risk as IRS visibility improves [1][3] Group 1: IRS Reporting Changes - The IRS will implement Form 1099-DA starting January 1, 2026, requiring U.S. centralized exchanges to report detailed information about crypto transactions [2] - This new reporting requirement is part of the 2021 Infrastructure Investment and Jobs Act and aims to clarify taxable events for traders [2][3] Group 2: Global Reporting Framework - The Crypto-Asset Reporting Framework (CARF) will begin in 2027, expanding global reporting obligations for crypto transactions [4] - CARF mandates that participating jurisdictions collect and share information about crypto users with their home tax authorities, eliminating loopholes for traders using foreign exchanges [5] Group 3: Reporting Requirements Under CARF - CARF requires exchanges to report every sale, swap, and transfer without any minimum thresholds, including small transactions [6][8] - Exchanges must collect full KYC information, identify users' tax residency, and report all transactions to the user's home country [9]

Core Points - The ongoing US government shutdown has led to the IRS furloughing nearly 34,000 employees, significantly impacting its operations [2][5] - The IRS has scaled back most operations, which will affect crypto tax services, leading to reduced taxpayer assistance and increased backlogs [1][4] - The shutdown does not alter tax deadlines or legal requirements for taxpayers, who must still file and pay taxes by the due dates [6] Impact on IRS Operations - The IRS will send home call center representatives, IT staff, and most headquarters personnel, which is expected to severely affect customer service [2][4] - The furlough will result in a sharp reduction in customer service and live support, making it difficult for cryptocurrency users to obtain necessary tax clarification [4][5] - Ongoing tax disputes and audits related to cryptocurrency reporting will experience significant delays due to the staffing reductions [5] Consequences for Crypto Tax Services - The IRS is in the process of developing new reporting requirements for digital assets, but the prolonged shutdown may delay the finalization of this guidance [6] - If the shutdown continues, crypto taxpayers will face a challenging and confusing environment for tax filing [7]