Daily Management Review

U.S. authorities set to introduce full control over cryptocurrencies


Lobbyists defending cryptocurrency have been rebuffed on a proposal to fix general tax rules in the U.S. Senate. Politicians argue that the industry needs more money for future legislative battles for its interests, writes Bloomberg.

The emerging industry has failed to push for changes to the cryptocurrency tax reporting rules spelled out in the infrastructure bill. The Senate is preparing to pass legislation that would give U.S. authorities broad oversight over the circulation of digital money.

The proposed amendment would have eliminated new tax reporting requirements for crypto firms. The amendment was drafted by the senators because of the lack of technical ability of miners and software developers to submit tax data to the appropriate government agency.

Previously, the IRS had no jurisdiction over their activities. The crypto market has now reached two trillion dollars in capitalization, and the currencies themselves are set up to stay off the radar. The new requirements for cryptocurrencies would bring in an estimated $28 billion in federal revenue, according to experts. That amount is already included in a new $550 billion infrastructure package.

Major sectors such as banking, housing and pharmaceuticals have long established ties with lawmakers and successfully lobbied for their projects, while the cryptocurrency industry is just making itself known in the halls of Congress. Senators advocating for this market see the reason for the recent legislative defeat as a lack of funding and proper organization.

Politicians are increasingly interested in this growing industry. Recently, Miami officials decided to issue their own cryptocurrency to supplement the city's budget.

source: bloomberg.com