Senator Lummis Pushes for Crypto Tax Reform to End Double Taxation on Bitcoin Miners

U.S. Senator Cynthia Lummis has intensified her call for urgent legislative changes to the current cryptocurrency tax framework, highlighting the unfair double taxation faced by Bitcoin miners and other digital asset participants. According to Lummis, miners are taxed twice: initially when they receive block rewards and again upon selling those assets, creating a significant financial strain on those supporting blockchain operations.

At the 2025 Bitcoin Conference, Lummis emphasized that existing tax laws, especially those stemming from the 2021 Infrastructure Investment and Jobs Act, impose excessive burdens on miners, developers, and decentralized finance (DeFi) users. The broad definition of “broker” under this legislation forces miners and other non-custodial actors to comply with reporting requirements they cannot realistically meet, such as disclosing user identities and transaction details, which they often do not possess. This has led to complex compliance challenges and discouraged innovation within the U.S. crypto sector.

Lummis advocates for using the budget reconciliation process to swiftly amend these provisions, aiming to redefine “broker” in a way that exempts miners and developers from onerous reporting and taxation. She argues that reforming these outdated tax policies is crucial to fostering a more vibrant and competitive digital asset industry in America. Her proposed changes would alleviate the double tax on block rewards, simplify tax compliance, and potentially attract greater institutional investment by providing clearer regulatory guidance.

The senator’s push reflects growing concern among lawmakers and industry stakeholders that current tax rules do not adequately reflect the unique nature of blockchain technology and digital assets. By updating these regulations, Congress could remove significant barriers to crypto adoption and innovation, ensuring fairer treatment for miners and other key participants in the ecosystem.

Senator Lummis’s efforts underscore a broader movement to modernize crypto taxation, balancing the need for regulatory oversight with the imperative to support technological progress and economic growth in the digital economy. The senator has called on Congress to reform the taxation of cryptocurrencies, specifically targeting the double tax burden faced by Bitcoin miners. This issue has gained significant attention as the digital currency landscape continues to evolve, and lawmakers are increasingly recognizing the need for regulatory clarity.

Lummis, a prominent advocate for cryptocurrency regulation, has highlighted the unique challenges faced by Bitcoin miners. Currently, miners are subject to two layers of taxation: first, on the income derived from mining activities, and second, on the capital gains realized when they sell the mined Bitcoin. This double taxation can be a significant financial burden, potentially stifling innovation and growth in the industry.

The senator's proposal aims to streamline the tax treatment of cryptocurrencies, making it more favorable for miners and other stakeholders in the digital currency ecosystem. By reducing the tax burden, Lummis hopes to encourage more investment and participation in the cryptocurrency market, which could ultimately benefit the broader economy.

The call for reform comes at a time when the cryptocurrency industry is facing increased scrutiny from regulators and lawmakers. The rapid growth of digital currencies has raised concerns about their potential impact on financial stability, consumer protection, and national security. As a result, there is a growing consensus that a comprehensive regulatory framework is needed to address these issues and provide clarity for market participants.

Lummis' proposal is part of a broader effort to modernize the U.S. tax code and adapt it to the realities of the digital age. The senator has been a vocal advocate for cryptocurrency regulation, and her efforts have garnered support from industry stakeholders and lawmakers alike. By addressing the double tax burden faced by Bitcoin miners, Lummis hopes to create a more favorable environment for innovation and growth in the cryptocurrency industry.

The senator's call for reform is a significant development in the ongoing debate over cryptocurrency regulation. As the industry continues to evolve, lawmakers will need to strike a balance between promoting innovation and protecting consumers and investors. Lummis' proposal is a step in the right direction, and it remains to be seen how Congress will respond to her call for action.