Many cryptocurrency proponents and entrepreneurs are frustrated at the fact that the United States, one of the most powerful superpowers in the world, has yet to establish some clear cryptocurrency regulation. There are some lawmakers that are hoping to change that with the reintroduction of the Token Taxonomy Act on Tuesday.
This isn’t the first time that the bill has been introduced. Two U.S. House representatives, Warren Davidson and Darren Soto, introduced the bill in late 2018. The point of the bill is to make it easier for cryptocurrency investors to trade in the sector, and tries to distinguish cryptocurrencies from the traditional definition of “securities.” In essence, digital assets would be exempt from aforementioned definition. Davidson urged Congress to pass the law, adding that it would send a “powerful message” that the United States is serious about being a global blockchain hub.
Four other U.S. representatives are co-sponsoring the bill, including Josh Gottheimer, Tedd Budd, Scott Perry and Tulsi Gabbard. Five of the six individuals involved in advancing the bill are members of the House Financial Services Committee. Notably, Gabbard is running for president of the United States.
There are some changes in the bill from the 2018 version, however. There is a more detailed definition of what constitutes a digital token that is more inclusive of emerging technologies, apparently. One significant part of the definition adds that digital tokens references a “digital data structure” in which “consensus is achieved.”
The Coin Center, a non-profit research center that advocates for pro-blockchain technology, praised the move in a blog post. The Coin Center also praised the fact that it would make purchases made with cryptocurrency easier with relation to tax purposes, as an exemption for cryptocurrency gains under $600 is included in the bill. This means that small purchases, such as a meal or cup of coffee—purchased with Bitcoin—wouldn’t need to be reported to the Internal Revenue Service (IRS). The Center added that they are positive about “continued engagement” with lawmakers on these issues, as well.
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