It’s not traveled an easy road thus far. House Democrats said Tuesday morning that they won’t delay a vote on the bill until the $3.5-trillion reconciliation package is ready. That’s created division between the party’s moderate and progressive members.
Rep. Alexandria Ocasio-Cortex (D-N.Y.) told CNN on Monday that she’d vote against the bill if it’s voted on before the larger reconciliation package is ready. Progressives in the party have been threatening to withhold support for the infrastructure bill to force moderate support for the reconciliation package, which includes measures to support education, health care, energy, climate change and immigration.
Meanwhile, the language in the infrastructure bill that changes the broker definition to include any person or entity “effectuating transfers of digital assets on behalf of another person” remains unchanged. That new definition, which the Congressional Budget Office estimates could raise $28 billion in tax revenue, has prompted questions about tax impacts.
For Adam Liposky, ecosystem operations lead at Pocket Network, the question is whether legislators understand the industry they intend to tax. The Pocket Network protocol was rolled out on Polygon last month to support decentralized API requests with better end-user protections.
“The definition present in the bill labels wide swaths of cryptocurrency participants as brokers and requires rigorous reporting requirements that some of these market participants will be unable to fulfill,” Liposky said. “The lawmaking we’ve seen to regulate the crypto space demonstrates a severe lack of understanding of the underlying technology.”
There have been attempts to alter the language in the bill. Sens. Ron Wyden (D-OR), Patrick Toomey (R-PA) and Cynthia Lummis (R-WY) proposed an amendment to exclude network validators, miners, sellers of hardware and software wallets and developers who don’t have a customer relationship with the people who use their open source code.
But the proposal failed when Sen. Richard Shelby (R-AL) withheld his support after his own amendment for $50 billion in defense spending failed.
“After Senator Shelby thwarted a proposed amendment to the U.S. infrastructure bill that would improve its language regarding cryptocurrencies, the bill hasn’t been altered further,” said Antoni Trenchev, co-founder and managing partner of Nexo.
Nexo, a crypto lending institution, was founded in 2018. Because it operates in more than 200 jurisdictions, the language in the infrastructure bill is unlikely to impact its operations. Trenchev said it’s likely to cause problems for Nexo’s U.S.-based and -focused peers, though.
“While companies like Nexo, with clients all over the world, remain in a stable position, the survival of those with users only in the US might be at risk under unclearly worded legislation,” he said.
It’s not traveled an easy road thus far. House Democrats said Tuesday morning that they won’t delay a vote on the bill until the $3.5-trillion reconciliation package is ready. That’s created division between the party’s moderate and progressive members. Subscribe for full article
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