On December 18, Representative Byron Donalds of Florida, accompanied by 18 fellow Republicans, addressed a letter to Scott Bessent, the acting commissioner of the Internal Revenue Service (IRS). The letter urged the agency to reconsider a rule that categorizes “cryptocurrency staking rewards”—the additional tokens earned by staking cryptocurrency on a blockchain network—as taxable income upon receipt. Donalds contended that similar to mining gold, those who mine or stake cryptocurrencies are the primary owners of this emerging property. He argued that income should only be recognized upon the sale of the asset, not at the time of receipt.
On the same day, it was disclosed that Donalds purchased between $50,001 and $100,000 in Bitcoin. This information came to light through a congressional financial document reviewed by NOTUS. However, Donalds’ office clarified that his wife, Erika Donalds, was responsible for the Bitcoin purchase, stating they would amend the financial disclosure to reflect this. Spokesman Daniel First emphasized that the letter to the IRS had no influence on Bitcoin’s market price.
Questions concerning the motivations behind the Bitcoin acquisition and whether it posed a conflict of interest for Donalds remained unanswered. Notably, his recent financial disclosures did not indicate any previous ownership or trades of Bitcoin for either himself or his wife before the December transaction. Donalds is also a candidate for the governorship of Florida and serves on the House Committee on Financial Services, which is significantly involved in shaping cryptocurrency policy. The committee has organized crypto-focused hearings and has hosted events like “Crypto Week.”
Earlier in the year, Donalds proposed legislation aimed at establishing the Strategic Bitcoin Reserve and U.S. Digital Asset Stockpile, a concept initiated by former President Donald Trump through executive order. However, this bill has yet to be put to a vote.
Some critics, including former Republican Representative Reid Ribble, expressed concern regarding the timing of the Bitcoin purchase, suggesting that it could undermine public trust. Ribble remarked that the couple could have avoided any perception of impropriety by refraining from trading Bitcoin altogether, especially given the close proximity of the trade to Donalds’ involvement in cryptocurrency legislation.
The Donalds have a history of making financial transactions that might raise eyebrows. Earlier in the year, they executed trades involving stocks worth between $8,008 and $120,000 shortly after former President Trump’s tariff announcement, which had caused significant volatility in the markets. Their trading included shares of Visa Inc. and other companies vested in the tech and pharmaceutical sectors.
The potential for conflict of interest among members of Congress has reignited discussions concerning trading restrictions for public officials, both Republicans and Democrats. Advocates for stock-trading bans within Congress argue that lawmakers should uphold stricter ethical standards than the general populace. This movement is fueled by instances of officials violating existing trading laws, such as the Stop Trading on Congressional Knowledge (STOCK) Act. Republican leadership has pledged to advance its version of stock-trading legislation, although it may apply exclusively to the legislative branch, leaving out the executive branch, which some Democrats are pushing to include in the reforms.
