Bitcoin groups ask Congress to extend crypto tax relief beyond stablecoins
A coalition led by the Bitcoin Policy Institute and including Bitcoin Voter, Blocks, Crypto Council, Digital Chamber, MoonPay and River has sent a letter to House Ways & Means Chair Jason Smith and Senate Finance Chair Mike Crapo asking Congress to expand tax exemptions for crypto payments beyond dollar-pegged stablecoins to Bitcoin and large network tokens. They argue the GENIUS Act’s limited tax relief for compliant payment stablecoins undermines broader crypto use because current IRS rules treat crypto as property, making everyday purchases taxable events that require capital gains tracking. The groups propose extending cash-like de minimis relief to network tokens meeting a $25 billion market-cap threshold, capping individual tax-free transactions at $600 and annual tax-free use at $20,000. They cite Federal Reserve data that about 45 million Americans hold crypto (mostly Bitcoin), roughly 7 million used Bitcoin-like tokens for payments in 2024, and some 3,500 U.S. merchants accept Bitcoin. The coalition warns recent broker reporting rules (Form 1099-DA) increase reporting burdens and audit risk without calibrated de minimis relief. Major backers and prior political efforts (including Senator Cynthia Lummis and Block’s Jack Dorsey) are referenced as part of ongoing efforts to make Bitcoin practical for everyday payments.
Neutral
The coalition’s push to expand de minimis tax relief to Bitcoin and large network tokens reduces friction for crypto payments, which is constructive for wider adoption. If legislators adopt the proposed exemptions (market-cap and transaction limits), merchants and consumers could use Bitcoin with less tax paperwork — a bullish structural change. However, this is a policy lobbying effort, not an enacted law; political hurdles and competing regulatory priorities mean adoption is uncertain. Short-term market reaction is likely muted or neutral: announcements of lobbying or proposals typically produce limited price moves unless coupled with legislative progress. Long-term impact could be mildly bullish for Bitcoin and major network tokens if relief passes, because reduced tax friction increases transactional utility and retail adoption. Comparable past events: proposals to simplify tax treatment (and regulatory clarifications) have tended to support adoption sentiment but only materially move markets when translated into concrete laws or broad regulatory guidance. Traders should watch legislative developments, committee hearings, and any language added to bills as catalysts; broker reporting rules already effective (Form 1099-DA) may keep near-term volatility higher due to reporting noise.