Online survey of 564 US Bitcoin owners: 16% plan to hold investment for less than a year, 67% haven't sold any, 36% don't plan on reporting purchase to the IRS
The price of Bitcoin has risen dramatically since the start of the year. The virtual currency now trades at $6,490 (as of 11/13), up from $997 at the start of 2017.
Context & Ripple Effects
LendEDU's snapshot lands mid-mania: Bitcoin ran from $997 to $6,490 over 2017, and the survey captures owners who mostly bought into that run — two-thirds had never sold, so most gains were still on paper. The standout number is behavioral, not financial: more than a third planned to keep the IRS out of it entirely.
What came after validates the concern. Chainalysis later traced long-term investors unloading roughly $30B of bitcoin between November and April, collapsing the investor-to-trader ratio from about 3x to 1.2x — exactly the kind of mass realization event that turns unreported purchases into unreported gains. And by the time Pew found only ~17% of US adults had ever used crypto but ~66% doubted the market was safe or reliable, the trust deficit this survey hinted at had become the industry's central problem.
First-order effects
- The 36% of surveyed owners who plan to skip IRS reporting carry direct personal exposure if they sell, since disposition is what crystallizes the taxable gain; the 67% who haven't sold still have no taxable event to report.
- LendEDU's data hands the IRS a quantified baseline of expected noncompliance among US bitcoin holders at the exact moment holdings appreciated sevenfold in a year.
Second-order effects
- When holders like these finally sold — as Chainalysis documented in the ~$30B investor exodus — every one of those dispositions became a reportable gain, converting a quiet compliance gap into a large-scale reconciliation problem for tax authorities.
- Exchanges and brokers become the practical enforcement chokepoint: if a third of buyers self-report nothing, regulators' cheapest fix is requiring the platforms where trades settle to do the reporting instead.
Third-order effects
- If early-owner noncompliance was the norm, the durable outcome is reporting migrating from individuals to intermediaries — the structural shift behind broker-style tax reporting regimes that later crypto regulation built on.
- The same survey wave that measured evasion also foreshadowed the trust problem Pew later quantified: an asset class whose retail base distrusts both the market and the taxman faces a harder path to mainstream adoption than its price charts alone suggested.
The trend: Cryptocurrency adoption has consistently outrun its participants' willingness to report holdings and gains, pushing tax enforcement toward exchange-level reporting rather than voluntary self-disclosure.