Biden budget proposes closing crypto loophole to raise $24 billion in new revenue

Biden’s budget proposal rolled out Thursday included a new provision that would close a loophole currently available to crypto investors that could raise up to $24 billion in revenue.

Highlights

• President Biden’s budget proposal includes a proposal to change the tax treatment of cryptocurrency transactions.
• Currently, crypto sales aren’t subject to the same rules that investors in stocks or bonds have to follow.
• The new provision would raise $24 billion, according to the White House.
• Biden already passed a crypto-related tax provision that was tucked in his 2021 infrastructure act.
• The Treasury Department later clarified that miners, validators, and other crypto users will not be classified as crypto “brokers” under tax reporting rules.
• Federal Reserve Vice Chair of Supervision Michael Barr emphasized that the same regulations that safeguard banks should apply to crypto if the activity is analogous without squashing innovation.

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