Blockchain Association Presses Congress on Crypto Tax Bills as Clarity Act Stalls

October 23, 2026 MM Crypto Team

Crypto Tax Legislation Takes Center Stage on Capitol Hill

The Blockchain Association sent a letter to Senate and House leadership on Thursday asking Congress to pass bipartisan digital asset tax legislation, marking the group’s first broad push on taxes since the Clarity Act failed in the Senate. The letter was signed by Chief Policy Officer Lindsay Fraser and addressed to Majority Leader John Thune, Minority Leader Chuck Schumer, Speaker Mike Johnson and Minority Leader Hakeem Jeffries, arguing that the rules governing the 67 million Americans who hold digital assets “were written for a different era.”

The industry group paired the letter with a new advocacy website, TaxClarityforAmerica.com, built so constituents can contact their representatives directly about crypto taxes.

The asks will sound familiar to anyone following the tax debate. The letter calls for a de minimis exemption for small transactions, cash treatment for stablecoins, taxation of mining and staking rewards at the time of sale rather than receipt, broker reporting limited to firms that actually hold customer assets, and wash sale rules designed to close loss harvesting without catching everyday transactions in the net. It adds a safe harbor for foreign traders using U.S. exchanges, a mark-to-market election for traders, and eligibility for research and development tax credits for blockchain development work.

Notably, the letter leaves out the one thing many expected: an endorsement. Two bills are genuinely in play, and the association named neither. As Punchbowl News reported Thursday, the refusal to back either bill signals that the industry wants more than Congress has produced so far — and it is keeping its options open for whatever survives the legislative process.

Where the Two Crypto Tax Bills Stand: H.R. 10357 and the ADAPT Act

The House moved first. One day after the Clarity Act failed in the Senate, the House Ways and Means Committee approved the Digital Asset Tax Certainty Act, H.R. 10357, a 114-page package from Chairman Jason Smith (R-MO). The bill exempts network fees under $10 from capital gains reporting, with a carve-out for taxpayers who made more than 5,000 transfers in the prior year, and extends wash sale and constructive sale rules to digital assets. Qualified dollar stablecoins are exempt from the wash sale rule.

The package left out the provision the industry wanted most. Representative Mike Carey’s Tax Clarity for Mining and Staking Act, H.R. 9175 — which would have let miners and stakers defer tax until they sell their rewards — appeared in an early discussion draft but was gone from the text the committee released on September 14. Instead, the bill classifies validation rewards as ordinary income, taxable on receipt. Representative Steven Horsford (D-NV), who had proposed capping the deferral at five years, voted for the package anyway and said it leaves the question open for further work. The Blockchain Association, Crypto Council for Innovation and Digital Chamber had asked the committee in June to pass the mining and staking bill without changes. The committee did the opposite.

The Senate has its own version. Senator Steve Daines (R-MT) introduced the ADAPT Act on September 30 with Senators Cynthia Lummis, Bernie Moreno and Tim Scott as cosponsors. It exempts purchases made with GENIUS Act stablecoins from gain or loss, sets the same $10 fee threshold as the House bill, and applies wash sale rules with grandfathering for existing holdings plus exemptions for mining and staking rewards. It currently sits in committee.

An earlier effort also lingers. Lummis’s S. 2207, with a $300 per-transaction de minimis exemption capped at $5,000 a year, has been sitting in the Finance Committee since June 2025. Neither chamber’s bill contains the exemption for small bitcoin purchases that the industry made a centerpiece at Bitcoin 2026. The House bill’s $10 threshold covers fees, not purchases. The Senate bill’s spending exemption covers stablecoins, not bitcoin. The Bitcoin Policy Institute and others have argued that any de minimis rule should cover bitcoin, and Thursday’s letter asks for a “meaningful” exemption without naming a figure.

De Minimis Exemptions and Wash-Sale Rules, Explained

For readers new to the tax mechanics, two concepts dominate this debate. The first is the de minimis exemption. Under current U.S. rules, almost every crypto transaction is a taxable event. If you buy a coffee with bitcoin, you technically owe capital gains tax on the difference between what you paid for that bitcoin and what it was worth when you spent it — a compliance burden that blocks using crypto as money. A de minimis exemption would let small transactions slide — no gain or loss calculation required. Lummis’s S. 2207 would set that threshold at $300 per transaction, with a $5,000 annual cap per taxpayer. The Blockchain Association’s letter asks Congress for a “meaningful” exemption but deliberately avoids picking a number, likely to keep negotiating room open.

The second concept is the wash-sale rule. In the stock market, if you sell a stock at a loss to claim a tax deduction and then buy it back within 30 days, the IRS disallows the loss — that is the wash-sale rule, and it prevents “loss harvesting” abuse. Crypto has never been subject to it, which means traders can sell bitcoin at a loss on December 28, buy it back on December 29, and claim the deduction while keeping their position. Both current bills would extend wash-sale rules to digital assets, closing the loophole. The Senate’s ADAPT Act softens the landing with grandfathering for existing holdings and exemptions for mining and staking rewards, while the House bill exempts qualified dollar stablecoins from the wash-sale rule entirely — a sensible carve-out, since stablecoins are designed to hold a constant value and their “losses” are rounding errors, not real investment losses.

Why It Matters: Tax Becomes Crypto’s Best Lane After the Clarity Act Collapse

The Clarity Act’s collapse shapes all of this. The market structure bill passed the House 294-134 in July 2025, then stalled in the Senate for more than a year while the banking lobby fought the crypto industry over stablecoin yield and Democrats pressed for ethics language aimed at the Trump family’s crypto ventures. The cloture vote on September 15 failed 49-50. No Democrat crossed over, and Republicans Susan Collins, Josh Hawley and Jerry Moran voted no. Senator Thom Tillis switched his vote at the end so he could file a motion to reconsider, which keeps the bill alive on paper.

With market structure off the table, the industry has shifted its lobbying to what might actually move. Tax is the obvious candidate for three reasons. First, the House package cleared committee with bipartisan votes, proving the issue can cross party lines. Second, the wash-sale provisions raise revenue, which gives tax writers a reason to attach them to a larger must-pass vehicle — revenue raisers are legislative currency. Third, taxes affect every one of the 67 million Americans who hold crypto.

The timing is awkward, though. Congress is in recess until after the November 3 midterms. When members return, they will have a lame-duck session measured in weeks, and crypto taxes will compete with government funding and whatever else leadership decides to clear before the 119th Congress ends. Adding pressure, Lummis — the Senate’s loudest voice on digital asset taxes — retires in January 2027. If tax legislation does not move in the lame duck, the industry’s strongest Senate champion will be gone.

Regulators keep filling the gap in the meantime. The OCC issued its final GENIUS Act rule on Wednesday, and the SEC and CFTC have been setting market structure policy through rulemaking and enforcement in the absence of a statute — a trend that favors agencies over legislation and gives the industry one more reason to push for clear tax law while it still can.

Outlook: A Lame-Duck Window Measured in Weeks

The realistic path forward is attachment, not a standalone vote. The House package’s bipartisan committee margin and its revenue-raising wash-sale provisions make it the kind of text that tax writers can bolt onto a year-end vehicle. The Senate ADAPT Act’s grandfathering and mining-reward exemptions show where compromise language already exists. But the mining and staking deferral fight — the industry’s top ask — remains unresolved, with Horsford’s pledge of “further work” the only olive branch on the table.

Watch the lame-duck calendar after the November 3 midterms, any movement on Horsford’s five-year deferral cap, and whether the Blockchain Association’s new grassroots site generates constituent pressure. The letter landed Thursday with little room to move. Whether Congress listens before the clock runs out will decide whether 67 million crypto holders get a tax code written for this era — or keep living under one written for the last one.

FAQ

What is a de minimis exemption for crypto?

It would let small crypto transactions skip capital gains calculations entirely. Right now, even buying a coffee with bitcoin is technically a taxable event. Lummis’s S. 2207 proposes exempting transactions up to $300 each, capped at $5,000 a year. The Blockchain Association is asking for a “meaningful” exemption without naming a figure.

What are wash-sale rules, and how would they affect crypto?

Wash-sale rules stop investors from selling an asset at a loss for a tax deduction and immediately buying it back. Stocks already face them; crypto does not, which enables year-end loss harvesting. Both current bills would extend the rules to digital assets, with carve-outs — the House bill exempts qualified dollar stablecoins, and the Senate bill grandfathers existing holdings.

What happened to the mining and staking tax deferral?

Representative Mike Carey’s bill to let miners and stakers defer tax until they sell was dropped from the House package released September 14. The bill instead taxes validation rewards as ordinary income on receipt. The Senate’s ADAPT Act is friendlier, exempting mining and staking rewards from some wash-sale provisions.

Will crypto tax legislation pass this year?

It faces a narrow window. Congress is in recess until after the November 3 midterms, leaving a lame-duck session of just weeks, and crypto taxes compete with government funding. The House bill’s bipartisan committee approval and revenue-raising provisions make it a candidate for attachment to a larger bill — but nothing is guaranteed.

Source: Bitcoin Magazine

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