The crypto industry is pressuring Congress: lobbyists demand the preservation of tax benefits for miners and stakers
On June 21, leading crypto lobbying organizations — the Blockchain Association, Crypto Council for Innovation, and The Digital Chamber — sent a joint letter to the U.S. House Committee on Ways and Means. Their goal: to defend the Tax Clarity for Mining and Staking Act (H.R. 9175) in its original form and prevent amendments that, in their view, undermine the very essence of the bill.
The bill, introduced by Congressman Mike Carey on June 8, aims to regulate the taxation of mining and staking rewards. According to the document, new digital assets received for validating transactions are recognized as ordinary income. However, the taxpayer is granted the right to choose a special regime that allows them to be accounted for under a model similar to self-created property. This makes it possible to defer tax payment until the actual sale of the asset.
The Problem of "Phantom Income"
The key argument of the lobbyists is protection against so-called "phantom income." The letter emphasizes that the current IRS position requires miners and stakers to include the fair market value of received tokens in gross income on the date of receipt, even if these assets have not been sold. This creates serious liquidity problems: the taxpayer may face liabilities calculated based on the high price of the asset at the time of receipt, while having no actual cash proceeds. If the price subsequently falls, the tax becomes disproportionate to the actual income.
The Horsford Amendment: A "Broken" Bill
The main stumbling block is an amendment by Congressman Steven Horsford. It proposes limiting the tax deferral to five years. If a taxpayer who has chosen the special regime does not sell the asset by the end of the fourth tax year after the year of receipt, they will be required to recognize a gain or loss under a deemed sale mechanism. Essentially, this is a forced fixation of the tax base, even if no sale occurred.
CEO of the Crypto Council for Innovation, Ji Hun Kim, called this amendment "destructive," stating that it turns H.R. 9175 into a "five-year forced timer." The lobbyists point out that this approach not only creates additional administrative burdens for market participants, advisors, and the IRS itself but also strips the bill of its core purpose — providing flexibility and fairness. The budgetary effect of the amendment, according to the Joint Committee on Taxation, is only $101 million over a decade — a negligible amount compared to the potential damage to the industry.
Banking Lobby vs. the Crypto Industry
The bill has also faced criticism from the traditional financial sector. The American Bankers Association (ABA) stated that H.R. 9175 creates "clear favoritism" for crypto assets, placing them on an unequal footing with bank deposits and dividends. According to the ABA, this could stimulate a flow of funds from the banking system into crypto products, negatively impacting lending to small businesses and local communities.
My analysis: The fight over H.R. 9175 is not just a technical dispute about taxes. It is a clash of two philosophies: one striving for flexibility and fostering innovation, the other seeking to maintain the status quo and protect traditional financial institutions. Until Congress reaches a clear compromise, miners and stakers will continue to operate in an environment of uncertainty, which restrains capital inflow into the sector. A five-year deferral is a half-measure that does not solve the "phantom income" problem but merely postpones it.