The authorities in China have started taxing small and medium investors trading U.S. stocks. Some of my friends used to think that being small investors meant they wouldn’t be taxed, but that illusion has now been shattered. Apparently, after the upgrade of the powerful Golden Tax Phase IV system, data from various institutions has been integrated, allowing for big data cross-referencing. If it detects large foreign exchange transactions + overseas account balances, but your personal income tax declaration is zero, the system will automatically flag it. It’s also said that the technical capabilities of Golden Tax Phase IV are far beyond imagination. The current limitation is manpower, not the system’s capacity. With increasing financial pressure on local governments in China, overseas assets have become a new tax source. Expanding from large investors to small investors is an inevitable trend. I feel like this will push more users to trade U.S. stocks on-chain, increasing transaction volumes, which is a positive for the RWA sector. But then I suddenly thought—doesn’t this make cryptocurrency an even bigger new tax source? If one day the Golden Tax system integrates with CEX platforms, the pain of being forced to pay taxes that U.S. stock traders are feeling now will hit the crypto community hard. So scary.