To levy $28 billion in cryptocurrency taxation dispute over new U.S. infrastructure bill

The encryption clause in the new U.S. Infrastructure Act requires exchanges and other encryption applications to adapt to new information reporting requirements, and it is possible to collect about 28 billion U.S. dollars in cryptocurrency taxes. The focus of this dispute mainly revolves around the definition of the term “broker” in the bill.

On August 3, local time, according to the US Congress media Roll Call, US Democrat Senator Roman Wyden and Republican Senator Pat Tumi were cooperating to formulate amendments to the bipartisan infrastructure bill. Concerns: Whether the new reporting rules for cryptocurrency trading include exchanges and other types of potential companies in the category of “brokers”.

The encryption clause in the bill requires exchanges and other encryption applications to adapt to new information reporting requirements, and it is possible to collect about 28 billion U.S. dollars in cryptocurrency taxes. The focus of this dispute mainly revolves around the definition of the term “broker” in the bill.

In response, Pat Toumi said in a statement issued on Monday that the bill has the problem of “overly broad definition of brokers”. For example, non-financial intermediaries and non-brokers, including miners, also exist. May cover it.

According to an assistant of Roman Wyden, Wyden supports the reporting rules for cryptocurrency transactions, but is concerned about the lack of clarity in the language of the bill and may classify blockchain technology developers as “brokers.”

Will it kill the encryption industry?

According to CNBC’s report on Monday, the bill has triggered collective opposition from the encryption industry and said it may stifle the encryption industry.

Oppenheimer analyst Owen Lau once expressed his concern: “If I transfer Bitcoin for you, then it means I have become a broker.”

According to Coindesk, in the past week, the Blockchain Association, Coin Center, and Coinbase’s newly established policy team held a meeting and used their internal relationships to try to change the wording of the bill. However, due to the impact of the new crown epidemic, the progress has become more difficult. 

Kristin Smith, executive director of the Blockchain Association, called the bill “one of the two major policy threats” that the U.S. crypto industry has seen.

On Tuesday, the CEO of digital payment company Square and Twitter founder Jack Dorsey (Jack Dorsey) once said that he very much supports Wyden and Toumi’s efforts for the amendment. At present, the content of the bill affects miners and other non-governmental organizations. Financial intermediaries have put forward unreasonable demands.

What is the impact on the market?

But some experts believe that although the bill may upset some bitcoin investors, the market’s response to the bill has been very calm so far.

According to Coindesk, Bitcoin is currently the largest cryptocurrency by market value. News of the bill continues, but Bitcoin is still showing an upward trend recently. It has fallen back in the past few days, but as of press time, the price of Bitcoin has remained at around $38,000.

Edward Moya, senior analyst at Oanda, mentioned that the bill does affect the recent bullish macro development of Bitcoin trading, but it will not change the institutional trading rules.

He also said that additional crypto taxes may prevent some retail investors from investing, but he said that most people in the crypto market will not be affected by this.

Some crypto experts, such as crypto over-the-counter trader Henrik Kugelberg, believe that the bill may have a positive impact on the market because it can bring greater appeal and visibility to the digital asset market.

He pointed out: “Most people agree to pay taxes on their income, which will make crypto transactions more common.” 

Quantum Economics analyst James Deane said that cryptocurrency is a global phenomenon, and the United States is only one of the jurisdictions, which means that the impact of this bill is very limited.

He also pointed out that the current bill is still far from being implemented and having an impact on the market. The measure still needs to be negotiated by Congress and signed by President Joe Biden, and it is not expected to take effect until 2023.

 

Posted by:CoinYuppie,Reprinted with attribution to:https://coinyuppie.com/to-levy-28-billion-in-cryptocurrency-taxation-dispute-over-new-u-s-infrastructure-bill/
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