In this episode, Compass Live welcomes three leading advocates for common-sense legislation and regulations in the cryptocurrency industry to talk about the latest Congressional infrastructure bill:
This discussion is important for anyone in the cryptocurrency industry, but especially for miners.
Other ways to watch and read about this conversation:
Watch previous livestreams here.
What's the problem? A high-level summary of the bill (timestamp)
- IRS guidelines for cryptocurrency taxes still need clarification.
- Information reporting requirements for economic activity (crypto-related or not) shouldn't be uncertain.
- Texas cryptocurrency companies are going overseas because US tax clarify is so inferior to other regimes.
The process of amending the bill; fixing the problematic language (timestamp)
- The bill's original text and its definition of "broker" was quite concerning.
- A turning point in the discussion was when Senator Portman said miners weren't intended to be included in the bill. But why wasn't that in the original language?
- Senator Wyden and others introduced an amendment that makes it explicitly clear miners are not included as "brokers."
Where are the political lines around Bitcoin in the US Capitol? (timestamp)
- Politicians are either supporters of Bitcoin or they're uninformed.
- Big state-level progress made in drafting legislation to support the industry, especially in Texas.
- Cryptocurrency needs to be kept bi-partisan.
- Everyone wants sensible regulation that doesn't thwart innovation and treats cryptocurrency information reporting like other established asset classes.
How was the bill originally drafted? What's going on behind the scenes that caused the problematic language? (timestamp)
- A very small group of people in the Senate and a couple committees influenced the language of the bill. There was no formal process for drafting this language.
- Several senators were kept in the dark, although that's not abnormal.
- There will be more regulatory battles in the near future.
Was the dangerous language in the bill intentional or accidental? (timestamp)
- Regulators and legislators have been struggling with defining the prototypes for information reporting requirements for cryptocurrency activity.
- Regulatory committees have great attorneys and lawyers, but they're not steeped in cryptocurrency. But they invite experts to advise them.
What's the worst-case scenario for miners here? (timestamp)
- There could be no amendment and the bill doesn't change, but that doesn't seem likely at all.
- Mining will stay in the US, add jobs, access unused power, and remain an incredible opportunity for the US.
- Court battles will probably follow any adverse outcome from the infrastructure bill.
- Miners are in a pretty good place already, but the language should be explicitly clear.
- Legislative history would be the next-best thing if an amendment doesn't pass.
- Most reporting rules are in the regulations, not the bill itself. The IRS will write rules, and there's no sense that they're anti-crypto or want hostile regulation.
- Advocacy and education for the cryptocurrency industry has grown and matured a lot in the past five years.
What's next? What should miners expect now? (timestamp)
- Call-in campaigns are underway to pressure senators to support clear language in the bill.
- In the meanwhile, people should consult personal tax council for more advice on reporting requirements. Get buttoned up.