Key facts
- Crypto industry groups are urging Congress to pass the Tax Clarity for Mining and Staking Act without amendments.
- The bill proposes to tax crypto mining and staking rewards upon sale, rather than receipt, to avoid 'phantom income' taxation.
- House Democrats and the American Bankers Association have expressed skepticism, citing fairness concerns and potential advantages over other asset classes.
- An amendment proposed by Rep. Steven Horsford to limit tax deferral to five years is opposed by the crypto industry.
- The crypto lobby views the current bill as a compromise that should be passed as is to avoid jeopardizing bipartisan support.
A coalition of cryptocurrency industry lobbying groups, including the Blockchain Association, Crypto Council for Innovation, and The Digital Chamber, has urged Congress to pass the Tax Clarity for Mining and Staking Act without amendments. The bill aims to provide clarity on the taxation of cryptocurrency mining and staking rewards, proposing that these rewards be taxed upon sale rather than at the time of receipt. The industry argues that taxing rewards upon receipt constitutes 'taxation of phantom income' and creates liquidity issues. However, House Democrats and the American Bankers Association have voiced skepticism, contending that the bill unfairly favors cryptocurrencies over other asset classes. A proposed amendment by Representative Steven Horsford to limit the tax deferral to five years has been met with strong opposition from the crypto lobby, which fears it would undermine the bill's compromise and bipartisan support. The industry is framing the current version of the bill as a durable solution that addresses years of tax uncertainty.