The Bitcoin Policy Institute (BPI) is actively advocating for the expansion of proposed de minimis tax relief for digital assets, urging Congress to include not only payment stablecoins but also Bitcoin and other significant network tokens. Currently, under existing law, Bitcoin is classified as property, which requires capital gains calculations on every purchase made with it, regardless of the transaction amount. This taxing framework, BPI argues, serves as a deterrent for everyday transactions, such as buying coffee or making small remittances, forcing users to meticulously track their cost basis and report any minor gains or losses.
In recent legislative discussions within the 119th Congress, different approaches have been considered to address this issue. Senator Cynthia Lummis has proposed a standalone bill intending to establish a per-transaction threshold of $300 with an annual cap of $5,000 while also tackling the taxation of mining and staking activities. Meanwhile, House representatives Max Miller and Steven Horsford have introduced a discussion draft linked to the PARITY Act. This draft seeks to confine the exemption to regulated payment stablecoins and align itself with a $200 threshold, paralleling foreign currency regulations.
BPI describes the movement towards a “stablecoin-only” de minimis tax model as a notable shift from previous bipartisan initiatives that aimed to cover a wider array of digital assets. The organization highlights that confining tax relief to stablecoins would leave most Bitcoin transactions burdened with full reporting obligations, neglecting the reality that stablecoin transactions often depend on separate network tokens for transaction fees, which themselves are taxable events.
In response to this narrowing of the proposed legislation, BPI has taken action by spearheading a coalition letter directed at key tax policymakers and initiating an outreach campaign throughout Capitol Hill. Over the past three months, they have engaged with 19 congressional offices across both houses, advocating for a more inclusive value-based exemption that would encompass both GENIUS-compliant payment stablecoins and large-cap network tokens. They propose a potential threshold of up to $600 per transaction, with an annual cap around $20,000.
BPI further cautions that as midterm politics loom, the opportunity for comprehensive digital asset tax reform may dissipate, particularly with Senator Lummis set to exit the Senate in January 2027. They stress the importance of advancing a legislative package before an anticipated push in August 2026.
In a related development, Coinbase has recently found itself denying claims that it opposed Bitcoin tax relief. Chief Policy Officer Faryar Shirzad and CEO Brian Armstrong refuted allegations made by Bitcoin podcaster Marty Bent, who suggested that Coinbase had lobbied against the proposed de minimis tax exemption, asserting that the exchange deemed it unnecessary given Bitcoin’s limited use as currency. Shirzad labeled the accusation as “a total lie,” emphasizing that Coinbase has never lobbied against Bitcoin. Armstrong echoed this sentiment, dismissing the rumors as “totally false,” particularly after being prompted for clarification by Jack Dorsey, founder of Block Inc.
