US Crypto Tax Break Unlikely: Experts

US Crypto Projects Unlikely to See Zero Capital Gains Tax Benefit: Experts

Experts in the crypto industry have cast doubt on the likelihood of US-based crypto projects seeing zero capital gains tax benefits. Despite reports of zero income tax on crypto, significant practical, legal, and economic challenges remain, particularly regarding government revenue.

Dennis Porter, CEO and co-founder of Satoshi Action Fund, has stated that removing capital gains on crypto entirely depends on the US Congress. He believes it is highly unlikely that the US Congress will include such a proposal in a tax bill in the near term, citing the significant loss in government tax revenue as a primary obstacle.

The crypto industry must lobby for meaningful steps forward to reduce tax obligations. Porter suggests securing a de minimis exemption of $200 for Bitcoin and other digital asset transactions, aligning with the existing $200 exemption for foreign currency transactions. This proposal has bipartisan support and could become a reality with de minimis exemption tied to inflation.

The crypto market has shown bullish sentiment on the US-based crypto projects and the potential zero tax on these cryptocurrencies. However, experts warn that a sharp divide between US and non-US crypto projects, with a 30% capital gains tax on the latter, may be designed to attract global crypto investments to the United States.