US Senate Votes New Infrastructure Law Threatening Cryptocurrencies!
Important events related to cryptocurrencies are taking place in the United States. Two important legislative amendment requests in the new infrastructure law, which Democrats and Republicans jointly submitted to the Senate, will be voted on in the parliament. If it is accepted, important bans that will not be limited to the USA and will affect the whole world are at the door.
In the USA, Democrats and Republicans have agreed to an infrastructure law, in which 1 trillion dollars are allocated. The scope of the law will positively impact many Americans. The law, in which $1 trillion will be spent, includes important efforts to expand high-speed internet widely, build better roads and bridges, improve public transportation and clean drinking water systems, combat climate change, modernize power grids, and popularize electric vehicles...
Shortly before the new infrastructure law was presented to the Senate, it was proposed by two senators to include two different law amendments covering cryptocurrencies in the infrastructure law. Considering the proposed law change, cryptocurrencies using the Proof of Work (PoW) mechanism such as Bitcoin seem to remain exempt for now, but cryptocurrencies using the Proof of Stake (PoS) concept such as Cardano are under a great tax threat. After these two legislative changes were proposed, a supportive statement came from the White House.
The proposed amendment by Senator Rob Portman and Mark Warner came as a shock to the Senators, who supported the crypto industry, after Biden's support. According to the bill previously submitted by Senator Ron Wyden, Pat Toomey, and Cynthia Lummis and expected to pass the USA Senate, a wide range of crypto miners and developers would also be excluded from the definition of “brokerage”. Thus, those who fit the definition would not have to report their customers to the US Internal Revenue Service as required by the definition of "broker", which is expected to put them in a very difficult position as miners do not have specific customers.
US President Joe Biden aims to raise $28 billion in funds for the new infrastructure law, which he will remove from the taxes collected with this law amendment bill that he supports. However, according to the leading names in the industry, this is not tax collection. It means moving the entire crypto market away from the US. According to the statements of General Counsel Jake Chervinsky, with these law changes, which are impossible to implement, the crypto industry will voluntarily end.
Cryptocurrency and civil liberties lawyer Martha Belcher also reported that this law change would make anonymous crypto money transfers impossible.
Brian Armstrong, CEO of the famous cryptocurrency trading platform Coinbase, found it meaningless for miners, validators, smart contract makers, and open source developers to enter the definition of “brokerage” and stated that it is impossible to fill out the 1099 forms required by this definition. Elon Musk responded to Brian Armstrong on Twitter, expressing his support. Elon Musk used the following words in his tweet:
“I agree, right now is not the time to pick winners or losers in crypto technologies. No crisis requires the immediate enactment of these hasty laws.”
Cryptocurrency supporters made statements against the law change from a lot of important names and they continue to come. If this law change is adopted, Defi platforms will also be adversely affected, apart from PoS cryptocurrencies. The law change, which practically means banning all of this, will affect the entire crypto industry pretty badly. We will continue to follow the results of the voting, the developments, and the next steps and inform you.