U.S. Senate Vote in Favor of Amendment That Threatens Crypto Industry

The United States Senate has voted in favor of the Warner-Sinema-Portman amendment to President Biden’s infrastructure bill in a landslide of 68-29 late on Sunday evening. 

The Warner-Sinema-Portman amendment has been widely criticized by the crypto community for imposing tax reporting requirements on non-custodial actors like miners and software developers who don’t record customer information.

Senator Cynthia Lummis (R-WY), one of the co-authors of the rival Wyden-Toomey-Luumis amendment, which exempts those hefty tax requirements, tweeted her disappointment. “I understand my colleagues’ positions. But real people are going to be hurt if we do not change the language in this bill,” she said. 

What happens next? 

The Senate allows for 30 hours of debate following a vote. This means that the Warner-Sinema-Portman amendment can be debated up until Tuesday morning, after which it would be signed into law. 

The Senate can still vote to change the infrastructure bill. Lummis and company remain committed to reaching an amendment that they believe will benefit the crypto industry. 

The Warner-Sinema-Portman amendment and crypto

The crypto community is broadly against the Sinema-Portman amendment because of the tax reporting requirements it imposes on non-custodial actors, who would struggle to comply.

If the Senate doesn’t change its stance on this amendment by Tuesday, certain non-custodial entities within the crypto industry—like miners or developers—will have to work out how to report tax information that they do not currently record. 

Jake Chervinksy, general counsel for Compound Labs and one of the loudest crypto voices on this issue, tweeted his disappointment following the vote. “The Senate has voted 68-29 to end debate. We wanted a vote on the Wyden amendment first, or on a Wyden-Warner compromise, but no luck,” he said. 

Ted Cruz (R-TX) is one of the highest-profile Senators who has defended the crypto industry amid debate about the bill itself. On Saturday, he said the Senate was “on the verge of passing legislation that would be terrible for cryptocurrency.” 

Those in favor of the Warner-Sinema-Portman amendment see no extraordinary burden placed on the nascent crypto industry. Senator Elizabeth Warren (D-MA) said the bill is “not a direct tax on crypto, it’s simply a reporting requirement that’s in place everywhere else. That seems like the right approach.”

9 August 2021 11:51