Last week, Bitcoin reached its highest price since May, going as high as $42,000. However, there’s a big question mark hovering about its price, following President Biden’s infrastructure plan that could mean the end of the crypto-mining world as we know it.
President’s bipartisan plan comes with the cryptocurrency reporting requirement, the purpose of which is to add another $20 billion for the US Treasury. As per this particular part of the plan, cryptocurrency miners, traders, and others involved in the industry would end up paying much higher taxes than before.
One of the biggest issues the crypto community has with Biden’s plan is that it sees every person “responsible for any service effectuating transfers of digital assets” as a crypto broker.
Crypto Giants Come Together Against Biden’s Plan
Cryptocurrency miners and developers could end up in big trouble if the plan goes through. That’s what all the major crypto companies seem to think. At least that’s the message Coinbase, Square, Rabbit Capital and a few other tech giants sent last week.
The story goes that the aforementioned companies sent a joint letter to the US Government, expressing their worry about financial surveillance, as well as about the dire consequences the bill could bring to the US crypto industry.
Their outcry was heard by prominent politicians, including Democrat Ron Wyden, who serves as the chairman of the Senate Finance Committee. Wyden proposed changing the plan in several aspects that affect the cryptocurrency community.
Senators Come Up with an Alternative
Ron Wyden wasn’t the only government official to speak out against the bill. A few days after Biden’s plan was announced, the Democratic senator revealed an alternative amendment, supported by his fellow Democrat Kyrsten Sinema, as well as Republican Senator Rob Portman.
Warner’s amendment would leave out digital asset developers, software/hardware sellers, and validators from tax reporting. Instead, only those whose work relies on “proof of stake” networks would be forced to do their tax reporting.
In layman’s terms, this means that Bitcoin miners would not be affected. The Warner amendment, however, would affect Ethereum miners, the reason being that this cryptocurrency is switching to the proof of stake network in the near future, through a set of updates expected to go in motion by the end of the year.
All this talk did not affect the price of major cryptos, which have been in a bullish mode over the last couple of weeks. However, the new plan could definitely wreak havoc in the US cryptocurrency industry, potentially enabling other countries to take the dominance.
As a reminder, the US is the world leader both when Bitcoin and altcoins are concerned, with nearly $2 billion being traded on US exchanges last year.