Policy Group Calls For Bitcoin Inclusion In Tax Exemptions
The Bitcoin Policy Institute (BPI) is pushing for Congress to expand proposed tax relief for digital assets beyond payment stablecoins to also include bitcoin and other major network tokens. Currently, bitcoin is classified as property, meaning that every transaction involving the asset triggers a capital gains calculation, regardless of the transaction size. This framework has been criticized by BPI for discouraging everyday payments like buying coffee or sending small remittances, as users are required to track cost basis and report minor gains and losses.
In response to this issue, lawmakers in the 119th Congress have introduced various approaches. Senator Cynthia Lummis has put forth a standalone bill that would establish a $300 per-transaction threshold with a $5,000 annual cap and address taxation related to mining and staking. Additionally, House members Max Miller and Steven Horsford have proposed a discussion draft tied to the PARITY Act, which would provide a narrower exemption for regulated payment stablecoins with a $200 threshold consistent with foreign currency rules.
BPI has expressed concerns about the shift towards a “stablecoin-only” de minimis model, stating that it diverges significantly from previous bipartisan efforts to encompass a wider array of digital assets. The group argues that confining relief to stablecoins would leave most bitcoin payments subject to full reporting requirements and overlook the fact that stablecoin transactions rely on separate network tokens for transaction fees, which are also taxable events.
In an effort to advocate for a more inclusive approach, BPI has spearheaded a coalition letter to key tax writers and conducted an outreach campaign on Capitol Hill, engaging with 19 congressional offices across both chambers over the past three months. The organization is advocating for a value-based exemption that would apply to both GENIUS-compliant payment stablecoins and large-cap network tokens, potentially up to $600 per transaction with an annual cap nearing $20,000.
BPI has cautioned that the window for comprehensive digital asset tax reform may close if Congress does not advance a package before an anticipated legislative push in August 2026, as midterm politics loom and Senator Lummis is set to leave the Senate in January 2027.
In a separate development, Coinbase Chief Policy Officer Faryar Shirzad and CEO Brian Armstrong have refuted claims that the exchange opposed Bitcoin tax relief. This denial comes in response to allegations made by Bitcoin podcaster Marty Bent, who reported that Coinbase had lobbied against the proposed de minimis tax exemption for Bitcoin. Shirzad labeled the accusation as “a total lie,” emphasizing that the company had never and would never lobby against Bitcoin. Armstrong also dismissed the claim as “totally false,” following a public inquiry from Jack Dorsey of Block Inc.
Overall, the efforts to expand tax relief for digital assets and the denial of lobbying against Bitcoin tax relief by Coinbase highlight the ongoing discussions and debates surrounding the taxation of digital assets in Congress.
