- Senate blocked an amendment that changed crypto reporting rules.
- The amendment called for specifically naming entities liable to report crypto data to IRS.
- Its failure has dealt a huge blow to the crypto space.
MONDAY: The US Senate blocked a move to change cryptocurrency reporting rules in the infrastructure. This leaves vague language calling for broad oversight of virtual currencies still in the legislation.
The proposed amendment had important specifics laid out in it, addressing concerns from the crypto industry. For instance, it stated that the original bill requires all involved entities to report tax data to the IRS. Parties like miners or developers wouldn’t have access to such authorities. Just this change alone took days to propose. Multiple negotiations took place between three Republicans — Pat Toomey, Cynthia Lummis, and Rob Portman — and two Democrats, Mark Warner and Kyrsten Sinema.
Describing the amendment, she said in an article:
This amendment clarifies in law what most of us already believe — that validators of distributed ledger data, like miners for example, or hardware wallet providers and software developers, should not be required to report transaction data to the Internal Revenue Service.
The amendment’s failure is a tough blow to the crypto industry, which was in support of more narrowly targeted oversight. At the same time, Portman stated that there are other ways to clarify the bill’s language. For example, partisans could make Senate floor speeches to show the lawmakers’ intent.
In an interview, Lummis commented on the rejection,
All that means is we’re gonna have to fight this another day because it’s important that the Congress define these terms and create a level playing field. She went on, Going forward this fall we’re gonna have to be much more proactive about defining terms in this space so people can still innovate.
The Senate’s refusal of accepting the amendment seems to be based on causes other than crypto itself. The partisan disagreement over which amendments to consider has already delayed the whole process.
Recently, Senator Ted Cruz also shared negative sentiments regarding the bill’s handling in the Senate.