Crypto Community Criticizes Biden's Proposed Crypto Tax Reporting Rules

Industry experts and commentators express concerns over new regulations

Several prominent figures in the crypto community have voiced their criticism of the crypto tax reporting rules proposed by United States President Joe Biden. The Internal Revenue Service (IRS) recently suggested that brokers adopt new regulations to ensure tax compliance in the crypto industry. However, many believe these strict measures will push the crypto industry further away from the U.S., hindering innovation and growth.

Concerns over stifled innovation and international competition

Ryan Selkis, the CEO of Messari, expressed his pessimism about the future of crypto in the U.S. if Biden is reelected. He even went so far as to advise individuals to "move abroad" or consider voting for the GOP, as they might be more favorable towards crypto. Similarly, Chris Perkins, president of CoinFund, pointed out that other countries have surpassed the U.S. in terms of crypto innovation, and these new regulations would only hinder the country's progress.

Skepticism towards both political parties

Some individuals within the crypto community remain skeptical that either the Democrats or the Republicans would adequately support crypto interests. One user stated that neither party would be good for crypto, while another highlighted concerns about privacy and the inability to conduct private transactions without tax and sanction surveillance.

Additional tax proposals impacting the crypto industry

Biden's recent suggestion to impose taxes on crypto mining has also raised concerns within the industry. The budget proposal aims to implement an excise tax on the costs of electricity used in digital asset mining. These actions have led to increased worries among crypto professionals about the regulatory environment in the U.S. and its impact on innovation within the nation.

Regulatory choices driving crypto firms away

The crypto industry in the U.S. has repeatedly expressed concerns about regulatory decisions negatively affecting innovation. Michael Sonnenshein, CEO of Grayscale Investments, warned that the Securities and Exchange Commission's (SEC) reliance on enforcement actions could ultimately force crypto firms to relocate outside of the country. He argued that resorting to lawsuits for every crypto-related issue stifles the innovation happening within the U.S.