Hong Kong and Mainland China are reportedly preparing to initiate tax audits on cryptocurrency holdings, according to legal expert Liu Honglin. The move aligns with global trends towards transparency in crypto taxation, similar to the Common Reporting Standard (CRS) used in traditional finance. Under CRS, foreign banks share account information with Chinese tax authorities, ensuring compliance with tax obligations regardless of income source. As the Web3 industry evolves, adherence to tax regulations is becoming an essential aspect of compliance.