Crypto Tax Benefits Missed in Senate Bill Passage

The U.S. Senate narrowly passed President Donald Trump’s massive reconciliation bill on Tuesday, but it did not include key tax amendments that would have benefited crypto users. The bill, dubbed the “One Big, Beautiful Bill,” was the subject of intense negotiations in its final hours, with pro-crypto senators and industry policy leaders pushing to include an amendment that would have provided numerous tax benefits for crypto stakers, miners, businesses holding crypto stockpiles, and retail digital asset users.

Senator Cynthia Lummis (R-WY) had been a key advocate for these crypto-related tax perks, spearheading the effort to include them in the legislation. However, the timing of the proposal proved to be a significant challenge. The crypto tax provisions were only deemed ready for inclusion over the weekend, leaving little time for their integration into the bill. This led to a flurry of activity on Monday, with Lummis pledging to raise a related amendment during the marathon vote-a-rama on the bill, and crypto policy leaders urging Americans to contact their senators to support the amendment.

Despite these efforts, by the time Vice President J.D. Vance cast the tie-breaking vote to pass the bill midday Tuesday, the crypto provisions had not been included in the deliberations. One crypto policy leader described the outcome as a “missed opportunity” for the industry, stating simply, “We just ran out of time.”

A spokesperson for Senator Lummis offered a more optimistic perspective, noting that the issues involved in the crypto amendment are now on the radars of top Republicans, including Senate Finance Committee chair Mike Crapo (R-ID). The spokesperson indicated that Lummis had productive conversations with Chairman Crapo and other Senate Finance Committee members over the last few weeks and looks forward to continuing her work with the committee to address these tax issues at a later date.

Crypto policy experts speculated that the amendment would have likely included measures to clarify that rewards earned from staking and mining crypto should only be taxed once sold, not at the moment of their generation. This would have addressed the long-standing issue of double taxation for miners and stakers, who are currently taxed both when they receive block rewards and when they sell them. Another measure, known as a mark-to-market accounting provision, would have allowed companies greater flexibility in reporting unrealized crypto gains, potentially boosting their balance sheets. Additionally, a de minimis tax exemption for crypto transactions under a certain threshold would have allowed Americans to not report crypto transactions worth less than a few hundred dollars as taxable for capital gains purposes, potentially increasing the adoption of crypto for everyday payments.