White House Unveiled as Puppet Master as New Amendment Threatens Crypto Industry

The Breakdown

Blockworks

Investing, Business

4.8 • 786 Ratings

🗓️ 7 August 2021

⏱️ 18 minutes

🔗️ Recording | iTunes | RSS

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Summary

The infrastructure bill-related surprise in the U.S. Congress came in the form of a competing amendment with a short list of exemptions from the original language. On this episode of “The Breakdown,” NLW addresses the latest updates on the bill, including: White House support of the Portman, Warner and Sinema amendment Proof-of-work prioritization The future of the bill The White House claimed support of the Portman, Warner and Sinema competing amendment, citing its ability to strengthen tax compliance in the crypto industry. Crypto advocates have been quick to call out the intentional gaps in the amendment’s language as well as the clear lack of technological understanding. The proposed amendment specifically excludes proof-of-work mining from the reporting requirements, a surprising stance compounded by the fact that the language itself seems to misunderstand the difference between validation and mining. Some Bitcoin maximalists rejoice at their preferential treatment over proof-of-stake networks like Ethereum, but it remains unclear whether this amendment would protect even Bitcoin in the long term. If the amendment were passed, the bill itself would not go into effect until 2023. Organizations like Fight for the Future are creating resources for crypto allies to contact their senators. If the amendment passes, how will crypto adapt? Enjoying this content? SUBSCRIBE to the Podcast Apple: https://podcasts.apple.com/podcast/id1438693620?at=1000lSDb Spotify: https://open.spotify.com/show/538vuul1PuorUDwgkC8JWF?si=ddSvD-HST2e_E7wgxcjtfQ Google: https://podcasts.google.com/feed/aHR0cHM6Ly9ubHdjcnlwdG8ubGlic3luLmNvbS9yc3M= Follow on Twitter: NLW: https://twitter.com/nlw Breakdown: https://twitter.com/BreakdownNLW The Breakdown is written, produced by and features NLW, with editing by Rob Mitchell and additional production support by Eleanor Pahl. Adam B. Levine is our executive producer and our theme music is “Countdown” by Neon Beach. The music you heard today behind our sponsor is “Razor Red” by Sam Barsh. Image credit: Alex Wong/Getty Images News, modified by CoinDesk.

Transcript

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0:00.0	Laws aren't about this treasury.
0:03.6	They're about the next treasury, and the treasury after that,
0:06.8	and the treasury after that, and so on and so forth until the end of time.
0:10.5	And guess what?
0:11.7	The nature of power is that once it has been granted or won,
0:15.5	it is extremely rare that it is then relinquished without just as much of a battle, if not more, as it took to win it.
0:23.6	Welcome back to The Breakdown with me, NLW.
0:28.6	It's a daily podcast on macro, Bitcoin, and the big picture power shifts remaking our world.
0:34.6	The Breakdown is sponsored by Nidig and produced and distributed by Coindesk.
0:42.6	What's going on, guys? It is Friday, August 6th, and this is not the week-ending podcast I would
0:47.8	have hoped to share. Things around the infrastructure bill had been trending positively,
0:51.8	but then, last night, at the 11th hour, a new competing
0:55.9	amendment was dropped disastrously and given the full weight of force by no less than the White
1:01.0	House itself. We find ourselves in a much tougher spot than we were at this time yesterday.
1:06.1	Here's how we got here. Last week, a last-minute provision was added to the infrastructure
1:10.3	bill that would change
1:11.3	tax reporting requirements in crypto by effectively reclassifying every actor and entity involved
1:16.4	in crypto transactions, even and especially perhaps non-custodial actors like miners and validators,
1:22.0	as brokers responsible for sending customer information to the IRS. The problem is that
1:27.2	miners and validators don't have
1:28.6	access to any customer information, so by operating at all, they would be operating illegally.
1:33.9	The goal of the provision was to get $28 billion in tax revenue that could go to offset the cost
	...

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