Republican Senator Cynthia Lummis from Wyoming has proposed a new tax bill that could significantly change the rules of cryptocurrency taxation. The primary aim of the legislation is to streamline the use of cryptocurrencies and support innovation in this area.
De Minimis Exemption for Cryptocurrencies
According to the proposed bill, small profits and losses from cryptocurrency transactions will be exempt from taxes. The legislation introduces an exemption limited to $300 per transaction and a total of $5,000 annually. There is also an anticipated inflation-indexed increase for this exemption starting in 2026.
Another important provision states that income obtained from lending cryptocurrencies will not be taxed as a sale, similar to securities lending. This could enhance capital efficiency and ensure compatibility with the current financial system.
Adjustments for Crypto Donations
The bill abolishes the valuation requirement during the donation of actively traded cryptocurrencies to charities. This convenience allows donations made through cryptocurrencies to be taxed similarly to donations of publicly traded stocks, potentially facilitating contributions to crypto-based charities.
Conclusion and Future Prospects
Senator Cynthia Lummis emphasized the necessity of adapting to the development of the cryptocurrency ecosystem in her statement regarding the bill.
"We must not stifle American innovation, and this bill makes participation in the crypto economy easier. We want to gather public opinion before finalizing this regulation."
According to the Joint Committee on Taxation of the U.S. Congress, the regulation is estimated to generate approximately $600 million in net revenue between 2025 and 2034. This revenue could help cover the cost of the bill.
As changes in tax regulations for digital assets occur globally, the steps taken by the U.S. are expected to set an example for other nations. Reducing the tax burden on digital assets and increasing legal clarity could enable sustainable innovations in the sector.
