Inland Revenue is warning hundreds of thousands of Kiwi crypto investors to properly declare their earnings now – or risk an “expensive surprise down the line”.

The agency said it had identified 355,000 unique crypto-asset users, who had collectively undertaken around 57 million transactions with a total value of $36 billion.

Tax authorities warn that profits from selling, swapping or exchanging crypto-assets must be correctly declared as income in New Zealand.

A first batch of letters has been sent to people who would normally have their tax assessed automatically – but Inland Revenue knew to have traded on one or more crypto-asset exchanges, a spokesperson said.

“Despite popular thinking, people are not invisible on blockchain. We…