White House Voices Support for Crypto Tax Law! Only PoW Miners and Wallet Providers Exempt, Community Outraged

The recent amendment to the U.S. infrastructure bill, which has caused a stir in the cryptocurrency community, imposes strict reporting requirements on developers and validators, but miners are not included.

Last-Minute Amendment

The cryptocurrency provisions in the White House infrastructure bill aim to expand taxation on cryptocurrency transactions to raise $28 billion for infrastructure funding and impose new reporting requirements on "brokers."

Today, Senators Mark Warner and Rob Portman introduced a "last-minute amendment" to the infrastructure bill with the goal of excluding proof-of-work and hardware and software wallet sellers from the legislation. However, the wording of the amendment indicates that cryptocurrency developers and proof-of-stake validators will still be subject to reporting and taxation.

Jeff Stein from the Washington Post also tweeted on Twitter shortly after the amendment was proposed, stating that the White House officially supports their amendment.

Community and Institutional Opposition

If the tweet is accurate, it means the White House does not support the amendment proposed by Senators Cynthia Lummis, Pat Toomey, and Ron Wyden. This amendment proposed a broader list of exemptions, including not only miners but also those validating distributed ledger transactions and developing digital assets or their corresponding protocols.

"By clarifying the definition of 'broker,' our amendment will ensure that non-financial intermediaries such as miners, network validators, and other service providers are not subject to the reporting requirements outlined in the bipartisan infrastructure bill," explained Pat Toomey on his Twitter.

Jerry Brito, the executive director of Coin Center, also mentioned on Twitter:

"The last-minute amendment proposed by Warner and Portman is quite bad. It only excludes proof-of-work mining, but offers no help to software developers."

Predictably, this minimal amendment has faced severe criticism from the crypto community. A petition urging citizens to oppose the amendment has been posted on FightForTheFuture.org, strongly condemning the legislation for significantly and purposefully expanding financial surveillance, thus stifling innovation.

The Electronic Frontier Foundation (EFF) also stated in an article:

Regarding the language in the amendment, the EFF believes that cryptocurrency "brokers," including software developers and cryptocurrency startups that do not custody and control assets for users, may even encompass miners confirming and verifying blockchain transactions. The EFF asserts that any entity in the cryptocurrency ecosystem could be deemed a "broker."

Lastly, the EFF added: "The requirement to collect customer names, addresses, and transactions would likely force nearly every company to surveil their users, even those completely unrelated to cryptocurrency."

The White House's infrastructure bill amendment has sparked waves of opposition recently, but a perfect resolution seems elusive in the short term.