The United States’ infrastructure bill is under consideration for revision in light of the crypto industry’s backlash
According to CNBC, an amendment to the US$1 trillion infrastructure bill currently before the US Senate would exempt bitcoin miners and other validators from a provision seeking funding for its implementation.
As Forcast News previously reported the provision sought to raise US$28 billion over a decade by requiring investors and brokers to comply with increased Internal Revenue Service reporting requirements. A broker was originally defined as any party that facilitates the transfer of digital assets. This was redefined on Sunday as “any person who (for consideration) is responsible for regularly providing any service effectuating transfers of digital assets on behalf of another person.”
This meant that non-custodial crypto industry participants, such as validators of proof-of-stake networks, would be required to collect personal information about their ‘customers,’ including their names, addresses, and contact information, in order to comply with required Form 1099 reporting standards. As Compound Labs General Counsel Jake Chervinsky noted, this would create complications for miners operating on anonymous, permissionless blockchains.
As those familiar with cryptography are already aware, users are anonymous and access is permissionless. Non-custodial actors, such as miners, are literally unable to obtain the information necessary to complete Form 1099s. In practice, this could imply a de facto ban on mining in the United States of America.
“By clarifying the definition of broker, our amendment will ensure non-financial intermediaries like miners, network validators, and other service providers — many of whom don’t even have the personal-identifying information needed to file a 1099 with the IRS — are not subject to the reporting requirements specified in the bipartisan infrastructure package.”
Senator Pat Toomey
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