Bitcoin advocacy groups are intensifying their push for comprehensive tax reforms in the United States, emphasizing the need to extend de minimis tax exemptions beyond stablecoins. In a recent letter to congressional tax leaders, these groups argued that limiting such exemptions solely to dollar-pegged tokens would fail to alleviate compliance challenges faced by millions of American crypto users.
Advocacy for Broader Crypto Tax Relief
The Bitcoin Policy Institute, alongside organizations such as Bitcoin Voter, Crypto Council, MoonPay, and others, sent a formal appeal to Senate Finance Committee Chairman Michael Crapo and House Ways and Means Committee Chairman Jason Smith. The coalition emphasized that exempting only stablecoins from tax obligations would undercut the purpose of crypto tax reform, particularly as cryptocurrency adoption continues to grow.
Current proposals aim to apply the exemption solely to stablecoins compliant with the GENIUS Act passed in mid-2026. However, the coalition insists that this approach disregards the fundamental role of major network tokens, such as Bitcoin, in payment systems. They propose applying a cash-like tax treatment to both GENIUS-compliant stablecoins and major network tokens, thus simplifying tax reporting for millions of users.
The Challenges of Crypto Tax Reporting
The Internal Revenue Service (IRS) continues to treat cryptocurrency as property, meaning even small transactions, like buying a coffee with Bitcoin, trigger taxable events. These transactions require tracking the cost basis and calculating gains or losses—a process that can overwhelm everyday users and businesses. The groups advocate for eliminating these barriers, supporting proposals that would exempt small crypto transactions, such as those under $600, from taxation.
Furthermore, the coalition has suggested a $25 billion market cap threshold to determine which network tokens qualify for exemptions, alongside an annual cap of $20,000 for such transactions. By incorporating network tokens within the exemption framework, lawmakers can ensure a holistic approach to crypto tax reform.
Growing Adoption of Bitcoin Payments
The letter also highlighted Bitcoin’s growing utility in real-world payments. Over 3,500 merchants in the U.S. now accept Bitcoin at point-of-sale terminals, covering all 50 states. With 45 million Americans owning cryptocurrency and approximately 7 million using Bitcoin or other network tokens for payments as of 2024, the advocacy groups argue that the country is in need of updated and inclusive crypto regulations.
Rekindling this debate, prominent industry figures such as Block founder Jack Dorsey have called for federal tax exemptions for small Bitcoin transactions, aligning with the broader push for mass Bitcoin adoption. The urgency is further heightened by new digital asset reporting rules that go into effect on January 1, 2025, adding complexity to tax compliance for users.
Suggested Tools for Simpler Crypto Transactions
Anyone looking to navigate the complex world of cryptocurrency payments and tax compliance can benefit from tools like the CoinTracker Crypto Tax Software. This platform simplifies tax reporting and portfolio tracking for crypto users, helping to reduce the burden of compliance by generating IRS-ready forms.
As the debate around cryptocurrency adoption and regulation continues, the proposed reforms represent a critical step in enabling seamless digital payments and fostering the broader use of decentralized currencies in everyday life.
