Logo image
Back
The Impact of Cryptocurrency Exposure on Corporate Tax Avoidance Among US Listed Companies
Journal article   Open access   Peer reviewed

The Impact of Cryptocurrency Exposure on Corporate Tax Avoidance Among US Listed Companies

Junnan Cui, Li Gao and Yufei Wang
Journal of risk and financial management, v 17(11), 488
01 Nov 2024
DOI: https://doi.org/10.3390/jrfm17110488
url
https://doi.org/10.3390/jrfm17110488View
Published, Version of Record (VoR)CC BY V4.0,  Open

Abstract

This study examined the association between corporate cryptocurrency activities and tax avoidance outcomes, utilizing data from US public firms covering the period from 2015 to 2023. Financial data were sourced from Compustat, while details regarding cryptocurrency activities were manually extracted from 10-K and 10-Q filings. Our analysis employed a fixed-effects regression model to examine the impact of these activities on cash effective tax rates (ETR). The findings indicate that firms engaged in cryptocurrency activities tend to have a lower ETR compared with those without such involvement. Notably, this effect was predominantly observed in companies directly engaged in cryptocurrency activities, such as accepting cryptocurrency as a payment method or actively trading cryptocurrency on an exchange platform. In contrast, firms involved in crypto mining or initial coin offerings did not exhibit a similar association. Our findings offer significant regulatory insights for governance bodies concerned with the implications of corporate cryptocurrency activities on tax strategies.

Metrics

12 Record Views
1 citations in Scopus

Details

Logo image