The cryptocurrency sector is preparing for a new regulatory and tax surge ahead of a vote on the infrastructure plan in the House of Representatives. The infrastructure plan aims to make an investment over 10 years, for more than $1 trillion in the renovation and construction of public infrastructure in the United States.
The new bill has caused great expectations in the crypto market, although Bitcoin continues to have a bullish trend, according to Coin telegraph some traders are preparing for a slight drop in the price of Bitcoin, the media estimates that the drop would not be lower than $36,000.
Within the text of the infrastructure plan, Democrats have managed to incorporate an Amendment that forces cryptocurrency brokers to disclose information about their users’ transactions using their platforms.
The provision in the infrastructure plan aims to raise up to $28 billion by imposing tax obligations on cryptocurrency traders in the United States.
The language of the legislation generated commotion within the crypto community, as blockchain transactions to be approved rely on mining by hundreds or even thousands of cryptocurrency miners
Due to the vague language used by the Amendment, several members of the crypto community are alarmed that software developers or miners could be affected by the legislation.
The language that was passed includes “any person who (for consideration) is responsible for regularly providing any service effectuating transfers of digital assets on behalf of another person.”
Both Senators Pat Toomey and Cynthia Loomis on the Republican side, as well as Ron Wyden from the Democratic wing have been critical of the vagueness of the Amendment in force in the infrastructure plan.
The Treasury Department clarified that no reporting requirements would be imposed on institutions unable to comply with such a requirement, referring to blockchain miners and protocol developers.
Coin Center director Jerry Brito clarified that the bill’s language currently requires brokers to report transfers on their platforms to the government and to report to the Internal Revenue Service (IRS) information on individuals making transfers over $10,000 in cryptocurrencies, as well as information on the recipient.
Aggressive intervention from the SEC
The high profitability, as well as their volatility, have put the cryptocurrency sector in the crosshairs not only of lawmakers in Washington but of bureaucrats at the Securities and Exchange Commission (SEC).
The SEC has requested information on activity from several crypto exchanges that have started selling tokens, whose value depends on the appreciation of cryptocurrencies and for the most part, these tokens rely on the Ethereum protocol for their creation.
According to, Gary Gensler, the chairman of the SEC, tokens issued by companies such as Uniswap constitute a Security, so these companies should submit to the regulation of the American financial system in order to issue them.
Coinbase is in a legal suit with the SEC, after informing the regulator that it wanted to establish a lending service where it intended to invite its users to hold a deposit in USD Coins, minimum of one dollar, to lend to Coinbase. The exchange in return offered an annual return of 4 % on the value of its users’ deposit. According to Coinbase’s manager, […] the SEC responded with a denial on the legality of the initiative.
Whether by lawmakers in Congress, or by SEC regulators, the cryptocurrency sector is getting ready for an upcoming regulatory intervention, in which the government will play a more vigilant role in the nascent world of blockchain.