New report details the emerging 'cryptocurrency lobby' as it fights new tax proposals 'with a vengeance'

New report details the emerging 'cryptocurrency lobby' as it fights new tax proposals 'with a vengeance'

"Cryptocurrency lobby" isn't a phrase that has appeared in many articles. But it's a lobby that, according to Politico's Victoria Guida, is "starting to find its footing" as cryptocurrency providers resist taxes included in an infrastructure bill proposed in the U.S. Senate.

Guida explains, "At issue in the lobbying battle was a proposal included in the infrastructure bill that would require cryptocurrency trading platforms and other entities defined as 'brokers' to report digital asset transactions to the Internal Revenue Service. Lawmakers and the Biden administration included the provision as part of a bid to raise revenue for infrastructure projects — about $28 billion, according to an initial estimate — and also address long-running concerns that cryptocurrency traders don't pay the taxes they should."

Cryptocurrencies include, among many others, Bitcoin, Litecoin, Dodgecoin and Ether.

According to Guida, "The industry was first caught off guard when lawmakers and the Biden administration targeted it with new tax rules tucked into the bipartisan Senate infrastructure bill announced last month. But it fought back with a vengeance, showing that startup digital trading platforms and other firms could rally a small army of recently requisitioned trade associations, lobbyists and public relations experts to put up a real defense. Still, they failed to secure changes as of Sunday night."

Guida notes that Republican Sen. Pat Toomey of Pennsylvania and Democratic Sen. Ron Wyden of Oregon "took on the White House to shield virtual currency players."

"Unlike Wall Street banks," Guida reports, "the industry was able to direct thousands of crypto enthusiasts on social media to join the battle by providing a real-time play-by-play of Senate negotiations. Jack Dorsey, the top executive of financial payments company Square, called on his 5.6 million Twitter followers to fight bill language that he called 'unworkable.' Even Kiss bassist Gene Simmons was involved, announcing in a tweet that he supported an amendment to protect the industry."

Cryptocurrency lobbyist Kristin Smith, who serves as executive director of the Blockchain Association, told Politico, "This has definitely been a wake-up call to crypto. But on the flip side, I think Washington is starting to see that crypto is more of a force than anybody ever anticipated."

Slate's Jordan Weissmann, in response to Guida's reporting, tweeted:

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