Monday Market Outlook #12
A lot has transpired politically in the United States over the past week and is continuing to take place over the course of this week. So here is a recap of last week and what to expect in the following days as it relates to the cryptocurrency asset class.
The 2021 Infrastructure Bill
Bipartisan support in the Senate allowed the Infrastructure Bill to make blazing headway towards law but has been hung up by some rather lazy syntax. Historically, large spending bills like this that garner positive attention from the general public also tend to have numerous hidden agendas buried under heaps of legal jargon legible only to lawyers.
Such was the case with the current Infrastructure Bill and it's stance on the cryptocurrency industry. The original language in the bill sloppily defined the key term "broker" as an over-reaching description of important actors within the cryptocurrency industry. Specifically requiring that all "brokers" must supply the Internal Revenue Service with all customer information via KYC (Know-Your-customer) or other surveillance techniques. This included hardware suppliers, software developers, Proof-of-Stake and Proof-of-Work validators (including other consensus mechanism validators), and many other middlemen to comply with tax obligations. This would have been crippling for the industry as many software developers, node operators, validators etc. would be pushed out of the country and large crypto organizations would be forced to hire out of the country as well.
This blanket "broker" definition hidden in the original draft was in efforts to help pay for the $1.2 trillion dollar bill via taxation, in which was forecasted to bring $28 billion dollars of revenue over the course of 10 years. This was in addition to worries that many cryptocurrency investors/participants actively avoid taxation.
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