FinCEN Form 114: What It Is, Who Needs It, and How Crypto Users Are Affected

When you hold crypto on a foreign exchange or wallet, you might be required to file FinCEN Form 114, a mandatory report for U.S. persons with foreign financial accounts exceeding $10,000 at any point during the year. Also known as FBAR, it’s not a tax form—it’s an information report filed directly with the Financial Crimes Enforcement Network, a division of the U.S. Treasury. This rule isn’t new, but crypto made it much harder to ignore. If you’ve ever used Binance, Kraken, or any non-U.S. platform to trade, stake, or store digital assets, you could be subject to this requirement.

What counts as a foreign financial account? It’s not just banks. The IRS and FinCEN treat crypto exchanges, wallets, and staking platforms outside the U.S. as financial accounts. So if you held $12,000 worth of Bitcoin on Binance (based in the Cayman Islands) for even one day in 2024, you had to file. The same applies to holding Ethereum on a Swiss-based wallet or staking Solana on a platform headquartered in Singapore. The $10,000 threshold is per account, not total. So if you had $8,000 on one exchange and $5,000 on another, you still had to report both.

People often think, "But I didn’t sell anything, so why does this matter?" The answer is simple: ownership triggers the rule, not transactions. You don’t need to cash out. You don’t even need to trade. Just holding crypto abroad above the limit makes you reportable. And the penalties for skipping it? Up to $10,000 per violation, and if it’s deemed willful, you could owe the greater of $100,000 or 50% of the account balance. That’s not a warning—it’s a financial bomb.

FinCEN Form 114 doesn’t care if you’re a casual holder or a full-time trader. It doesn’t care if you didn’t know the rule. Ignorance isn’t a defense. The IRS has been cracking down hard since 2021, cross-referencing data from exchanges, blockchain analytics, and international partners. And with crypto exchanges like Coinbase now reporting U.S. users’ foreign activity to the IRS, the chance of getting caught is higher than ever.

Some try to dodge it by moving crypto to U.S.-based platforms like Kraken or Coinbase. But that’s not always enough. If you ever held assets abroad—even for a week—you still owe the report. And if you’ve moved funds between foreign wallets, like from Binance to KuCoin, those count as separate accounts. The rules are strict, and the system doesn’t make exceptions.

So what should you do? If you’ve held crypto overseas and the total ever hit $10,000, file the form. It’s not optional. If you missed previous years, you can still catch up through the IRS’s voluntary disclosure program. It’s messy, but it’s better than facing a penalty that could wipe out your entire crypto portfolio.

The posts below dig into real cases where crypto users got caught—whether from Brazil’s new reporting rules, Mexico’s FinTech Law, or U.S. sanctions targeting foreign platforms. You’ll see how FinCEN Form 114 connects to global crypto regulation, what happens when you ignore it, and how to stay compliant without overcomplicating your life.