The U.S cryptocurrency community has spent the last week battling Congress over the proposed Bipartisan Infrastructure Bill that has a provision that defines “brokers” in the cryptocurrency industry as “any person who (for consideration) is responsible for regularly providing any service effectuating transfers of digital assets on behalf of another person.”
Along with the crypto community, the Senate is also divided over attempts to amend the language of the bill’s cryptocurrency taxation provision. One Senator on the side of the cryptocurrency community, Ted Cruz (R-TX), has stated that the bill contained “dangerous provisions that would devastate crypto and blockchain innovation.”
“Crypto got screwed tonight. There’s a partisan disagreement on spending, so Dems objected to ALL further amendments. That means NO vote on Wyden-Lummis to lessen the damage this bill will do to crypto, & NO vote on the Cruz amd. to repeal the new crypto rules altogether.”
He made the comment in a Twitter thread where he also expressed support for the amendment proposed by Senators Ron Wyden (D-Ore), Pat Toomey (R-Pa), and Cynthia Lummis (R-Wyo) that adjusted the reporting requirements to better suit the industry, while also announcing his own proposed amendment that will see the provision struck out completely from the bill.
“The Senate is on the verge of passing legislation that would be TERRIBLE for cryptocurrency. The infrastructure deal contains DANGEROUS provisions that would devastate crypto and blockchain innovation. Supporters of crypto need to make their voices heard”
Similarly, CEO of Twitter and long-time Bitcoin proponent Jack Dorsey has also proposed what he calls a “workable simplification” to the Senators and their staff while thanking them for their efforts so far in a thread on the micro-blogging platform.
Dorsey points out that the bill in its current state and should the Warner-Portman-Sinema proposed amendment which forces tax reporting rules on software and hardware developers, miners, and nodes operators “is an impossible task that will only drive development and operation of this critical technology outside the US.”
His solution to the debacle is that if the entire provision cannot be struck out so it can be given proper consideration at a later time, then the definition should be simplified to be only cryptocurrencies exchanges where digital assets are exchanged for fiat currency.
Dorsey then goes on to argue that the simplification will capture at least 90% of the industry that is actually directly involved with dealing with tax-paying customers. The remaining 10% of “edge cases” not captured by the simplified definition can then be properly debated upon at a later time.
The vote and hearing on the bill have already moved forward. The cryptocurrency community has been waiting for the proceedings which began yesterday and continued today to reach a final verdict. In the meantime, the community has rallied together using all available means to try to influence the outcome.
Cryptocurrency figures such as Jake Chervinsky and Neeraj K. Agrawal have been some of the proponents at the forefront of the lobby efforts. Chervinsky who is the general counsel for Compound Labs, Inc. – a financial technology company involved in building decentralized protocols for autonomous interest rate markets on the Ethereum blockchain – was one of the first to raise alarm over the bill. He has urged US citizens who care about cryptocurrencies to engage their representatives and advise them to vote in favor of the Toomey-Wyden-Lummis proposed amendment.