Eshoo urges Pelosi to amend infrastructure bill’s ‘problematic’ crypto regulation language

Rep. Anna Eshoo (D-Calif.) is joining the growing chorus calling for an amendment to language in the $1 trillion bipartisan infrastructure bill imposing new regulations on the cryptocurrency industry. 

Eshoo sent a letter to Speaker Nancy Pelosi (D-Calif.) Thursday urging her to amend “the problematic broker definition” in the Senate-passed bill that now faces the lower chamber. 

“I share the goals of the underlying provision to address tax evasion in the cryptocurrency market, but the House should amend it, as the bipartisan compromise amendment would have, to meet this goal without stifling innovation in a nascent industry by imposing unworkable regulations,” Eshoo wrote. “I stand ready to work with you to ensure the infrastructure legislation addresses tax evasion to pay for its investments without unduly threatening a growing sector of our economy.”

According to a leadership aide, the final language in the infrastructure bill will be reviewed. 

Along with Eshoo, the bipartisan leaders of the House Blockchain Caucus raised concerns over the language in a letter sent earlier this week to every House member. 

Cryptocurrency groups and the digital rights groups that joined to lobby for an amendment in the Senate, said they will be taking the fight to the House after failing to secure changes in the upper chamber.

The infrastructure bill includes a provision calling for additional reporting requirements in the cryptocurrency industry as a way to help fund the roughly $1 trillion bill. The reporting requirements could raise $28 billion over 10 years, according to the Joint Committee on Taxation. 

Industry leaders and digital rights organizations, however, argued the language in the bill could lead to unintended consequences by roping in software developers and so-called miners and requiring them to report data they would not have access to. 

A bipartisan group of senators offered a compromise amendment — after debate between two competing proposals last week that in part delayed a vote on the bill — which was also supported by the Treasury Department. 

The push to add the amendment ultimately failed the evening before the final bill vote Tuesday after Sen. Richard Shelby’s (R-Ala.) attempt to tack on his untreated proposal to boost military spending.