October 26, 2021

Not Reporting Info on Some Transaction Partners Could Soon Be a Felony - Ep.284

50 minutes

Remember the $1 trillion infrastructure bill, which caused considerable backlash from the crypto community due to the language regarding “brokers?” Abe Sutherland, an adjunct professor at University of Virginia School of Law, believes another provision tucked inside the bill could end up being a far more significant issue for anyone transacting in digital assets. Show highlights:

how Abe fell down the crypto rabbit hole

what provision 6050I is and how it could affect anyone transacting with digital assets

how 6050I works and when it would apply

why violating 6050I would be a felony

how 6050I discourages digital asset transactions

how 6050I would apply to different transaction types, like peer-to-peer trades, NFT sales, and smart contract escrow accounts

what information recipients of digital assets must verify from the sender

how the government came up with the $10,000 reporting threshold and why Abe believes this number is outdated

why Abe thinks proposing 6050I within the infrastructure bill is inappropriate

what reasons the government has to want to put such stringent reporting requirements on digital asset transactions

how 6050I fits under the financial laws of the Bank Secrecy Act

why Abe believes the amendment should be struck from the infrastructure bill

what Abe thinks of the constitutionality of 6050I

how Abe views 6050I as less about generating tax revenue and more about tracking people’s digital asset transactions

what action steps he says the crypto community can take to fix the bill

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Episode links

Abe Sutherland

https://twitter.com/abesutherland

Medium Post: https://medium.com/@laurashin/why-not-reporting-info-on-your-crypto-trading-partner-could-become-a-felony-c6399998f113

Information on 6050I

Abe’s research report

https://www.proofofstakealliance.org/wp-content/uploads/2021/10/Research-Report-on-Tax-Code-6050I-and-Digital-Assets-printable.pdf

Tweet thread from Abe

https://twitter.com/abesutherland/status/1438881314871156736

https://twitter.com/abesutherland/status/1443082205383696384

6050I article Abe wrote for Bitcoin Magazine

https://bitcoinmagazine.com/business/the-proposal-to-regulate-digital-asset-transactions-should-be-struck

Abe’s appearance on What Bitcoin Did to discuss 6050I

https://www.whatbitcoindid.com/podcast/hidden-danger-in-the-infrastructure-bill

Twitter spaces with Congressman Warren Davidson, Peter McCormack, and others regarding the infrastructure bill

https://www.youtube.com/watch?v=lCq6BVLzF44

Miscellaneous 6050I links

https://www.marketwatch.com/story/the-crypto-industry-could-take-tax-fight-all-the-way-to-the-supreme-court-11632509009

https://www.breitbart.com/politics/2021/09/29/infrastructure-bills-crypto-surveillance-criticized-unconstitutional/

https://fortune.com/2021/09/21/crypto-transactions-report-to-government/

https://www.coindesk.com/policy/2021/09/17/crypto-lobbying-group-warns-of-another-tax-provision-in-senate-infrastructure-bill

https://www.coincenter.org/an-unworkable-and-arguably-unconstitutional-tax-change-tucked-away-in-the-infrastructure-bill/

https://decrypt.co/81236/overlooked-part-senate-infrastructure-bill-renews-worries-crypto-lobby

https://nickanthony.substack.com/p/last-minute-cryptocurrency-taxation

https://www.cato.org/blog/infrastructure-bill-hangs-balance-so-does-crypto

https://ambcrypto.com/what-is-the-u-s-infra-bill-crypto-amendment-really-all-about

Unchained coverage of the infrastructure bill

How Congress Might Pass Laws Bad for Proof-of-Stake and DeFi

https://unchainedpodcast.com/how-congress-might-pass-laws-bad-for-proof-of-stake-and-defi/

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By Laura Shin

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