Bitcoin advocacy groups have formally reached out to leaders in Congress, urging the extension of de minimis exemptions to encompass Bitcoin and major network tokens, rather than limiting these benefits solely to stablecoins. In a recently sent letter, the coalition, which includes the Bitcoin Policy Institute, Bitcoin Voter, Blocks, Crypto Council, Digital Chamber, MoonPay, River, and others, expressed concern over current legislative proposals that would restrict tax relief to compliant payment stablecoins under the GENIUS Act.
The groups argue that excluding Bitcoin from tax exemptions would significantly undermine the intent of tax reform aimed at easing the compliance burdens for millions of Americans who utilize cryptocurrency for daily transactions. The coalition highlighted the increasing acceptance of Bitcoin as payment, with thousands of merchants across all 50 U.S. states now integrating Bitcoin into their payment options.
In their communication, the coalition emphasized the need for cash-like treatment of GENIUS-compliant stablecoins, advocating for the removal of transaction and annual limits, much like physical cash operates. They articulated that stablecoins do not function in isolation but rely on underlying blockchain networks that utilize separate network tokens for various operations including consensus and security. Therefore, they asserted that both network tokens and payment stablecoins should receive similar tax relief to support functional financial ecosystems.
To provide a structured approach, the coalition proposed a market capitalization threshold of $25 billion to identify which network tokens would qualify for these exemptions. Additionally, they suggested implementing a $600 limit per transaction and a $20,000 annual cap for qualifying transactions.
Statistics indicate that approximately 45 million Americans own cryptocurrencies, with Bitcoin leading the way. Furthermore, Federal Reserve data reveals that around 7 million U.S. citizens used Bitcoin or other network tokens for payments in 2024. The groups underlined that over 3,500 merchants across the country currently accept Bitcoin at checkout, positioning the U.S. as a leader in Bitcoin payment integration.
This initiative comes as lawmakers continue to wrestle with how to simplify tax reporting for cryptocurrency transactions, with the IRS categorizing crypto as property. This classification means that small transactions, such as buying a coffee with Bitcoin, trigger taxable events, complicating the usage of cryptocurrency in everyday life. Industry voices have expressed that the current tax implications discourage the use of crypto for daily transactions, potentially hindering the U.S. from realizing its ambition of becoming the global hub for cryptocurrencies.
The urgency of this advocacy has been amplified by the looming introduction of new broker reporting rules set to require reporting of digital asset sales on Form 1099-DA for transactions occurring after January 1, 2025. The coalition cautioned that without appropriate de minimis relief, the landscape would face considerable discrepancies, audit risks, and complexities that far outweigh the economic substance of the transactions involved.
