A provision in the infrastructure bill recently passed by the U.S. Senate has raised concerns in the crypto industry because it increases Internal Revenue Service reporting requirements for investors and brokers.
The bill now states that only people who offer digital assets will be treated as brokers
The bipartisan measure, which addresses a range of infrastructure-related measures, could raise as much as $28 billion from crypto investors. The bill received the green light but has gotten a lot of criticism from crypto industry insiders.
An updated version of the bill now states that only people who offer digital assets will be treated as brokers. The bill excludes explicitly decentralized exchanges, but it is unclear whether it also excludes miners, node operators, software developers, or similar parties.
“Progress had been made, though the language is still unacceptable.”
The legal expert and general counsel of Compound Labs Jake Chervinsky had tweeted about the previous bill that it aimed to “expand the Tax Code’s definition of ‘broker’ to capture nearly everyone in crypto, including non-custodial actors like miners,” “forcing them all” to apply know-your-customer (KYC) protocols to their users.
Regarding the updated bill, he created a tweet that stated that progress had been made, though “the language is still unacceptable.”
The bill is part of the administration’s plan Joe Biden to invest about $110 billion in roads, bridges, and critical infrastructure projects, with another $39 billion earmarked for modernizing mass transit, $65 billion for improving broadband Internet access, and another $73 billion for strengthening America’s power grid.