Crypto Industry Appeals Directly to Trump Amidst Congressional Stalemate
In a strategic move amid legislative uncertainty, numerous cryptocurrency organizations have directly petitioned former President Donald Trump, urging his administration to champion key policy initiatives. This outreach aims to secure "quick wins" for the sector while Congress continues its deliberations on market structure legislation, highlighting a proactive approach by the crypto industry to influence policy through executive action.
Key Takeaways
- Crypto groups are seeking "quick wins" from the Trump administration to advance policy goals while legislative efforts stall.
- Requests include protections for developers of permissionless protocols and self-custody of digital assets.
- The industry is also asking for tax clarifications, particularly regarding mining and staking rewards.
- Trump's nominee for CFTC chair, Mike Selig, views crypto regulation as a "critical mission."
Industry Seeks Executive Action on Crypto Policy
Dozens of crypto groups, led by the Solana Policy Institute and including prominent organizations like the Blockchain Association and the Digital Chamber, have penned a letter to former President Trump. The letter outlines specific policy initiatives they believe his administration can implement to complement ongoing legislative efforts. These efforts, particularly in the Senate concerning market structure, have faced delays.
The industry's requests focus on several key areas. They are asking for assurances that developers of source-available, permissionless protocols and front-ends will not face enforcement actions while related rulemaking is underway. Furthermore, they are advocating for the Securities and Exchange Commission (SEC) and Commodity Futures Trading Commission (CFTC) to safeguard individuals' ability to self-custody their crypto assets. Protections for decentralized finance (DeFi) innovations across various agencies are also a significant part of their appeal.
Tax and Enforcement Concerns Addressed
The petition also touches upon crucial tax considerations. The groups are requesting guidance from the Internal Revenue Service (IRS) that clarifies mining and staking rewards should not be taxed until the assets are sold. They also seek to have small gains from purchasing goods or services with crypto ignored as taxable events. Many of these tax-related proposals align with legislative ideas previously put forth by lawmakers like Senator Cynthia Lummis.
Additionally, the industry is calling for an end to any Department of Justice (DOJ) pursuit of "developers of DeFi technology, including open-source software protocols that are decentralized and permissionless on matters of civil liability." This request follows high-profile prosecutions of developers behind crypto mixers like Tornado Cash and Samourai Wallet.
Trump Administration's Stance on Crypto
The letter directly references Trump's past advocacy for the crypto sector, noting the "unprecedented opportunity" his administration and Congress unlocked for crypto stakeholders. The industry is urging him to adopt a "robust whole-of-government approach" to establish the U.S. as a global leader in cryptocurrency.
Meanwhile, Mike Selig, Trump's nominee to lead the CFTC, has signaled his commitment to the president's vision for crypto regulation. During his confirmation hearing, Selig described crypto oversight as a "critical mission" for the agency, emphasizing the opportunity to develop a framework that supports innovation while protecting investors and maintaining market integrity. Selig, who has experience with the SEC's Crypto Task Force, also commented on DeFi, suggesting a focus on the features of onchain applications and the presence of intermediaries rather than applying broad financial regulations to all blockchain-based applications.