The crypto industry warns the U.S. Congress: "Don't break tax clarity"
Leading U.S. crypto lobbying organizations—the Blockchain Association, the Crypto Council for Innovation, and The Digital Chamber—have joined forces to defend the integrity of the bill on taxation of mining and staking. On June 21, they sent a joint letter to the House Committee on Ways and Means with a clear demand: pass H.R. 9175 (Tax Clarity for Mining and Staking Act) in its original version and reject the proposed amendment.
Why the Horsford Amendment Is a Threat to the Entire Ecosystem
The bill, introduced by Congressman Mike Carey on June 8, aims to address the long-standing issue of "phantom income." Currently, the IRS requires including the fair market value of mined or staked tokens in gross income on the date of receipt. This creates significant cash flow gaps: the taxpayer is obligated to pay tax on an asset they have not yet sold and may not be able to sell without losses.
The amendment by Steven Horsford exacerbates the situation. It proposes limiting the tax deferral to five years, after which the asset would be deemed sold under a forced scenario. As Crypto Council for Innovation CEO Ji Hun Kim rightly noted, this turns H.R. 9175 from a tool for tax clarity into a "five-year timer with a forced sale."
The lobbyists emphasize that the five-year limit not only creates a massive administrative burden for market participants and advisors but also completely undermines the compromise embedded in the document. The Joint Committee on Taxation estimated the budgetary impact of this amendment at just $101 million over a decade—a negligible amount compared to the damage to innovation.
Banking Lobby vs. Crypto Innovation
Interestingly, the American Bankers Association (ABA) has also come out against the bill. They see H.R. 9175 as "clear favoritism" toward digital assets and fear an outflow of deposits into crypto products. This is a classic conflict of interest between the traditional financial system and decentralized technologies, where regulatory clarity becomes a battlefield.
My analysis: This situation is a vivid example of how regulatory uncertainty stifles the development of an entire industry. The Horsford amendment essentially brings us back to square one, where miners and stakers remain hostages of an inflexible tax system. If Congress succumbs to pressure from the banking lobby, it will not only hit the crypto sector but also undermine confidence in the U.S. as a jurisdiction friendly to technological innovation.