The crypto community is protesting a US infrastructure plan amendment that keeps strict reporting requirements for developers and validators but exempts miners.
In response to proposed amendments to the White House infrastructure plan’s crypto provisions, the crypto community has mobilized to oppose the plan, which seeks to raise $28 billion for infrastructure funding through increased taxation on cryptocurrency transactions and impose new reporting requirements for crypto “brokers.”
In a last-minute amendment to the infrastructure bill, Senators Mark Warner and Rob Portman proposed excluding proof-of-work, sellers of hardware and software wallets, as well as proof-of-work itself, from the legislation on August 6.
The language of the amendment, on the other hand, suggests that crypto developers and proof-of-stake validators would continue to be subject to expanded reporting and taxation, which some have deemed to be “unworkable.”
Several hours later, Washington Post economics reporter Jeff Stein tweeted that the White House has formally endorsed their proposed constitutional amendment.
Late breaking – White House is coming out formally in support of Warner-Portman-Sinema crypto amendment, implicitly against the Toomey-Wyden-Lummis plan
— Jeff Stein (@JStein_WaPo) August 6, 2021
If this is correct, it means that the White House will not support a competing amendment proposed by Senators Cynthia Lummis, Pat Toomey, and Ron Wyden, which would have provided a much broader list of exemptions, including those for entities “validating distributed ledger transactions,” entities “developing digital assets or their corresponding protocols,” and miners.
According to Toomey, “By clarifying the definition of broker, our amendment will ensure non-financial intermediaries like miners, network validators and other service providers are not subject to the reporting requirements specified in the bipartisan infrastructure package,”
In a statement, Jerry Brito, executive director of the Coin Center, blasted Warner and Portman’s much more limited amendment as “disastrous,” charging that Congress was “selecting winners and losers.”
If this passes this is the U.S. Congress picking winners and losers.
— Jerry Brito (@jerrybrito) on August 5, 2021 on Twitter.
In the crypto community, the minimal amendment has received widespread condemnation, with many observers pointing out that proof-of-work networks and software developers will be caught up in the new legislation.
Earlier this month, a petition urging citizens to oppose the amendment went live on FightForTheFuture.org, with the page decrying the law for “dramatically expanding[ing] financial surveillance” and harming innovation, among other things.
An article published on August 2 by the Electronic Frontier Foundation (EFF) criticized the amendment for including developers who do not control digital assets on behalf of users in its scope, arguing that this was unfair.
The EFF specifically took issue with language in the amendment that defines a cryptocurrency “broker” as any individual who is “responsible for and regularly providing any service effectuating transfer of digital assets,” The EFF argued that under the new definition, “almost any entity within the cryptocurrency ecosystem [could] be considered a ‘broker’” The EFF added the following:
“The mandate to collect names, addresses, and transactions of customers means almost every company even tangentially related to cryptocurrency may suddenly be forced to surveil their users.”
