Cryptocurrency advocates express frustration with bipartisan infrastructure language
As the Senate prepares to vote on the final passage of the massive $1.2 trillion bipartisan infrastructure package, members of the cryptocurrency space — those in favor of using blockchain technology for online transactions — are ramping up advocacy efforts against a last-minute cryptocurrency tax provision tacked onto the bill.
The provision would impose more federal regulation on cryptocurrencies and dramatically expand the number of cryptocurrency users who would have to report filings to the Internal Revenue Service.
Cryptocurrency advocates believe in the need to regulate the decentralized currency, but not by rushing to pin it to an infrastructure package with language they say is far too broad for the nuanced technology.
“This is no way to make policy. There’s decisions being made that will massively influence how cryptocurrency develops in America, but it’s being done as a last-minute addition to a must pass infrastructure bill,” said Neeraj Agrawal, director of communications at Coin Center, a think tank started in 2014 that focuses on cryptocurrency policy.
“There’s been a massive mobilization in DC to try to educate senators and members of Congress about the shortcomings of this language, but we do not have that much time,” he told CNN.
This week, following calls from advocates to tighten the language around who should be legally required to report crypto transactions, Democratic Sens. Ron Wyden of Oregon, Pat Toomey of Pennsylvania and Republican Sen. Cynthia Lummis of Wyoming, introduced an updated amendment to the original legislation that would narrow the scope of who needs to report tax information.
“Investors failing to pay tax they owe through cryptocurrency is a real problem, and I strongly support third-party reporting by exchanges where cryptocurrency is bought, sold and traded. Our amendment makes clear that reporting does not apply to individuals developing block chain technology and wallets. This will protect American innovation while at the same time ensuring those who buy and sell cryptocurrency pay the taxes they already owe,” Wyden said in a statement released through the Senate Finance Committee.