The recent struggle to enact a new infrastructure law was widely publicized and hotly debated. She is particularly controversial because of her language Cryptocurrencies.
The $ 1 trillion infrastructure plan will be voted on by the U.S. House of Representatives on September 27. It will be voted on without amendments.
The language of the bill uses a very broad language. Those who wanted a more limited scope opposed this.
It also caused controversy due to its monumental status. This is the first project to address cryptocurrencies directly in the United States. This is an area that is frequently quoted in regulatory and legislative debates.
“The Infrastructure Bill is the first law in U.S. history to take cryptocurrencies, and they will be taken into account by quality consumers,” said Ryan Bergen, founder and CEO of Teller Finance.
“As the bill returns to the US House of Representatives for further discussion on the specifics of cryptocurrency taxation, it becomes clear that the federal government is trying to increase its adoption rate in a way that closely reflects the industry,” he says.
Where the crypto community applies
Part of the infrastructure project associated with the cryptocurrency community is a subdivision that imposes strict government regulation of digital assets.
These rules would greatly expand the number of cryptocurrency traders who would have to report their earnings to the Internal Revenue Service (IRS).
Congressional accountants predict that tax revenue from the program will rise to about $ 30 billion over the next decade. An earlier plan to raise $ 100 billion had been thwarted by Republicans. That’s because they were interested in expanding the IRS range.
This cryptocurrency taxation has delayed the whole process due to its comprehensive scope.
Committee of Senators And representatives of both sides questioned the language used in this provision. These lawmakers include Republican senators Pat Doomie and Cynthia Lummis.
In early August, Republican senators Wrote a letter Collectively emphasizes that the cryptocurrency taxation amendment is vague and impractical.
The senators particularly questioned the definition of a cryptocurrency broker.
The definition of a broker’s bill states: “Any person (for regulatory consideration) provides any service that affects the transaction of digital assets. Decentralized exchange Or the bear-to-bear market ”.
Senators and many in the cryptocurrency community are concerned that these software developers and transaction checkers may be mixed up on this web and labeled as cryptocurrency brokers.
“The U.S. Senate Infrastructure Bill, under its current broker’s definition, represents an existential problem for the existing node ecosystem. Adam Liposki explains.
He added that the process was clearly urgent, adding that Tommy and other politicians within the government had also expressed concern.
A turning point for American cryptocurrencies
The end of this deal will mark a turning point in the history of blockchain technologies. Opponents of tax cryptocurrencies are also concerned that this could undermine the industry’s potential for positive change and motivation. The market to another place.
Stunt development and chance
“The U.S. Senate’s swift action in regulating and drafting legislation on new cryptocurrency tax rules could block innovations and limit opportunities for economic growth,” said Gunnar Jerve, CEO of First Digital Trust.
He points out that the digital real estate industry creates jobs and that “there is a lot of evidence that society is moving towards total digitalisation of funds.”
Some of the vulnerable areas include supply chains, health, education and various art communities.
“The infrastructure bill could have catastrophic consequences for the American blockchain industry. As it is currently being drafted, the bill will target miners, stackers and crypto developers. Doug Leonard, CEO of Hifi Finance, recalled.
“If this bill is not amended, it could prevent cryptocurrency discoveries from happening in the United States and encourage U.S. cryptocurrencies to go abroad,” he says.
If the critics are right, many formal transactions and brokers will not only be subject to the new tax requirements, but also many individuals associated with digital assets.
Cryptocurrency miners are reasonably concerned that they may fall prey to the vague explanation of a cryptocurrency broker and look for work in another area.
Thus, America loses future inventions and its workers go abroad to pursue their business.
The potential alienation of cryptocurrency miners cannot come to the United States at a bad time now Chinese miners They are looking for new homes to manage operations.
Currently, the United States and Kazakhstan are the preferred landing sites for these migrant miners.
“America’s latest bill reinforces what we already know: the cryptocurrency industry is global and not subject to the whims of one government or another. .
Arguing against tax evasion
Also, it is not as if there is already no contribution from the miners and others involved in the crypto space through the tax.
“U.S. cryptocurrency law ignores the fact that many companies that hold substantial mining shares are already making payments Income tax. The law is a deliberate move by the US government to reduce Mmercad’s profits and revenues, ”said Warid Bullock, head of The Brooker Group’s digital assets and international business finance advisory division.
“Considering the rate of return that miners are currently achieving, miners must accept the fact that they will eventually fall into the trap of regulation,” says Bulakul.
In addition, Maple Finance CEO and co-founder Sydney Powell did not see tax evasion as a major motivator for those involved in the cryptocurrency industry.
“People are attracted to this sector because it sets the best frontier for the free movement of capital to seek economic opportunities, not to avoid taxes,” he reinforces.
Biden government He said he did not plan to force miners to file taxes, but feared that making the exception would open the door to abuse.
This has been proven by the offer of Mark Hope, CEO of FINXFLO.
He assumes that “the purpose of any regulation will be similar to the current definition of a broker in Section 3 (4) of the Stock Exchange, which classifies a broker as ‘anyone engaged in the business of exchanging securities on behalf of a third party’, which does not apply to miners.
What does this mean for the community?
While some on social media dramatically call this the end of cryptocurrencies, there is little confusion over what the law actually does. Most businesses agree that ambiguous language can have a negative impact if it persists.
Coinbase CEO Brian Armstrong has been the most important voice on social media for the past few weeks. “This regulation could have a profoundly negative impact on American cryptography and could unknowingly drive further maritime discoveries,” he said.
He says the crypto community can learn a lesson from this. Lesson “Ignorance and distrust of innovation, even among some legislators, is very dangerous.”
The need to comply with the financial requirements stated in the bill is the biggest change in society.
As it stands, anyone considered a broker should report the details of their cryptocurrency transactions to the IRS for review.
The sale of cryptocurrencies will now be closely monitored by the government, just as any traditional broker would report a share sale. This will allow taxes to be levied very easily through the IRS.
Another thing the community needs to be prepared for is that those who fail to comply with the new tax requirements will be fined. Not only are they expensive, they are also expected to be difficult to deal with in court.
The government is starting to move
While the issues with the bill may indicate that lawmakers do not understand much about cryptocurrencies, it also shows that they are focused on it.
This scheme shows that the tax benefits of cryptocurrencies were taken into account before they were written. Still, the historic moment to regulate cryptocurrencies has finally arrived.
Moreover, the work of the trusted senators marks the future partnership between the government and the crypto community.
“Legislators and industry leaders have proven to have a dialogue and the crypto community can self-organize and fight side by side on important issues,” said Anthony Trensev, co-founder and managing partner of Nexo.
No matter how cryptocurrency tax cards fall, the fact that it delayed the entire infrastructure bill shows how interested the digital currency is in Washington DC
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