Infrastructure Bill Gets a Revision, But the Final Text Is Still ‘Bad’ and Now ‘Vague’ Too
Ron Wyden (D-Oregon) also came in support of the crypto community by voicing his concerns about the bill, saying it “fails to understand how the technology works.”
The controversial infrastructure bill has been revised after conversations with Senate staff and digital asset tax experts regarding the information reporting requirements for digital assets.
The Chamber of Digital Commerce has been focused on ensuring that node operators, miners, and validators aren’t included in the scope of the provision. The bill has now changed the definition of a broker to include “any person who (for consideration) is responsible for regularly providing any service effectuating transfers of digital assets on behalf of another person.”
Previously, the definition mentioned decentralized exchange and peer-to-peer marketplace.
“It's better than where it started, but still not good enough to clearly exclude miners and similarly situated persons,” said Jerry Brito, executive director of CoinCenter, a non-profit focused on crypto policies.
While the Chamber of Digital Commerce said in its clarification that the final bill text is making its intent of excluding node operators, miners, and validators clear by implying a contractual relationship, this might not be so.
“The language went from “very bad” to “very vague & still very bad.” Not an improvement,” said Jake Chervinksy, General Counsel at Compound Finance.
1/ @blockchainassn and its 46 member companies—companies with tremendous expertise in the crypto ecosystem—appreciate the Senate’s ongoing engagement on the digital asset tax information reporting provisions in the bipartisan #infrastructurebill.
— Blockchain Association (@BlockchainAssn) August 2, 2021
Blockchain Association also voiced its concerns about the latest language still posing fundamental concerns. Suppose these network participants who don’t have any customer relationships are required to provide information on their customers. In that case, it will be “impossible” to comply with them and drive innovation and business overseas.
“The industry should know—and needs to know—how this provision applies, but it still remains unclear. We look forward to continuing this dialogue and sincerely thank Senate offices for their engagement and attention to this issue so far.”
Meanwhile, after Congressman Warren Davidson, a crypto supporter came against the bill, Ron Wyden (D-Oregon) also tweeted his support for the cryptocurrency community.
While taxes owed through cryptocurrency is a “real problem that deserves a real solution,” Wyden said this bipartisan bill is not even close to that solution, instead “an attempt to apply brick and mortar rules to the internet and fails to understand how the technology works.”
Meanwhile, Nic Carter of Castle Island Ventures called out on the public-listed miners in the US, who haven’t been heard talking about the bill. “Where are they on this? For an existential threat like this, they should be absolutely flooding Washington with lobbying and money,” he said.
“We've made progress, but the language is still unacceptable. Next, we'll advocate for an amendment on the Senate floor. If that fails, we'll take our fight to the House,” said Chervinsky.