Some are urging U.S.-based crypto users to contact their representatives in support of the amendment from Wyden, Lummis and Toomey.
With more than one amendment proposed to the United States infrastructure plan that would modify a provision on cryptocurrencies, some figures in the space are going against the one with White House support.
Digital rights advocacy group Fight for the Future said today it would not support the amendment crafted by Senators Mark Warner, Rob Portman and Kyrsten Sinema to address the issue of clarifying the language used concerning crypto in the bipartisan infrastructure bill. According to the group, the proposed amendment gets “a resounding no” as a possible solution to the bill which “fundamentally misunderstands how cryptocurrency and decentralization works.”
“The original provision and the Portman-Warner amendment fundamentally misunderstand that decentralized technology is decentralized,” said Fight for the Future. “The law as-written is completely unworkable, requiring many in this ecosystem to produce data that they never have and cannot get access to — by the very nature of the technology.”
The group alleges that both the Biden administration and Democratic proponents of the amendment “have not done their homework on decentralized technology.” Others in the digital space have made similar claims, with the World Economic Forum’s head of blockchain and digital assets Sheila Warren calling the ongoing debate over amendments “highly unusual.”
“Bewildering is an understatement for what is unfolding in the U.S. Senate around the crypto-related provisions of the infrastructure bill,” said Warren. “It was remarkable to see language endorsed that was not neutral about technology. This has massive implications for a relatively nascent industry.”
On Wednesday, Senator Ron Wyden, Cynthia Lummis and Pat Toomey put forth an amendment to infrastructure bill HR 3684 currently under review in the Senate. The proposal received support from a number of lawmakers and figures in the crypto space, including Senator Rob Portman — a key Republican involved in the bill — as well as 114 signatories from the crypto and blockchain space, including Twitter CEO Jack Dorsey.
The senators originally proposed the amendment because the bill suggests implementing tighter rules on businesses handling cryptocurrencies and expanding reporting requirements for brokers, mandating that digital asset transactions worth more than $10,000 are reported to the Internal Revenue Service, or IRS. It also suggests that anyone in the business of “validating distributed ledger transactions,” “developing digital assets or their corresponding protocols,” or dealing with mining software or hardware would likely be subject to more tax reporting requirements for digital transactions.
While the amendment proposed by Wyden, Lummis and Toomey may change the bill’s definition of a broker and could allow many players in the crypto space to avoid the additional reporting requirements, a “modified” amendment put forth by Warner, Portman and Sinema the following day proposed excluding proof-of-mining and sellers of hardware and software wallets from the bill but suggests crypto developers and proof-of-stake validators would still be subject to expanded reporting. Some critics have claimed this modification would essentially allow the U.S. government to pick and choose which technology is acceptable in the crypto space.
The Warner, Portman and Sinema amendment received support from the Biden administration — reportedly with the exception of Treasury Secretary Janet Yellen. With the time available to pass the infrastructure plan seemingly dwindling, many in the crypto space and some lawmakers are pushing for the Wyden, Lummis and Toomey amendment to be put to a vote while attacking the provisions in the proposal from Warner, Portman and Sinema.
Leaders at major U.S.-based cryptocurrency exchanges have called on users to contact their representatives. Binance.US CEO Brian Brooks — prior to his resignation today — pushed Fight to the Future’s message and Coinbase CEO Brian Armstrong urged his more than 743,000 Twitter followers to support the amendment from Wyden, Lummis and Toomey.
“This debate in the Senate started because the government sees the growing crypto industry as a source of tax revenue,” said Armstrong. “We agree everyone must pay their taxes. There is no debate on this topic. But destroying some of the most exciting innovations in the process is unconscionable.”
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Author: Turner Wright