Billionaire investor Mark Cuban, a former cryptocurrency critic that turned supporter, has argued that the cryptocurrency tax provision included in the $1 trillion infrastructure bill could choke the sector’s growth.
Speaking to The Washington Post, the billionaire claimed the provision could shut off the bitcoin and crypto “growth engine,” which he says would be like “stopping e-commerce in 1995.”
Shutting off this growth engine would be the equivalent of stopping e-commerce in 1995 because people were afraid of credit card fraud.
Cuban added that it would also be akin to regulating the creation of websites decades ago because “some people initially thought they were complicated and didn’t understand what they would ever amount to.”
The crypto tax provision included in the Senate’s infrastructure bill has a broad definition of “broker,” defining it as any party “responsible for regularly providing any service effectuating transfers of digital assets on behalf of another person.”
Some in the cryptocurrency space have expressed concern for the language, as the bill could define miners and other network validators as brokers. In a joint statement the Blockchain Association, Coinbase, Coin Center, Ribbit Capital, and Square expressed concern over the language included in the infrastructure bill, as it will place “unworkable requirements on crypto technology.”
Mark Cuban’s words see him join a growing number of cryptocurrency industry proponents. Speaking to Forbes Paolo Ardoino, chief executive at British Virgin Islands-based crypto exchange Bitfinex, said:
The bill has the potential to swamp cryptocurrency transactions in the country with an invasive dragnet
Former Coinbase CTO Balaji Srinivasan has branded a last-minute amendment to the bill that would only exclude proof-of-work mining from the reporting requirements as a “backdoor bitcoin ban” that would make compliance impossible.”
Twitter and Square CEO Jack Dorsey has also expressed concerns, saying the bill could drive development and operations outside of the United States.
Senators Ron Wyden (D-Ore.), Pat Toomey (R-Pa.), and Cynthia Lummis (R-Wyo.) have proposed an amendment to narrow the definition of a broker in the bill. The Senate has, however, proceeded without considering any amendments.
DISCLAIMER
The views and opinions expressed by the author, or any people mentioned in this article, are for informational purposes only, and they do not constitute financial, investment, or other advice. Investing in or trading cryptoassets comes with a risk of financial loss.
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