12 August 2021
Regulation has never looked this good
Bearish news sees bullish sentiment
In the decade-plus of crypto’s remarkable lifetime, rarely has a week so soaked in FUD seen such optimistic price action. The US government’s $1Tn infrastructure bill stole headlines as we approached last weekend, as parties discussed how to fund the proposed program. While the Biden administration initially claimed the eye-watering sum would be fully paid for, the State has since conceded it will need to add an additional $256bn to the ever-growing abyss of US deficit to finance the fresh legislation.
Interestingly, a provision allowing heightened oversight of the crypto space formed the most contentious point of a bill targeting a nationwide infrastructure overhaul.
The proposal seeks to implement tax reporting requirements that would force crypto firms to declare customers’ sales to the IRS, in much the same way that stockbrokers currently do. Supporters have estimated that the plan could generate $28bn in additional funding — a figure of questionable significance in the grand scheme of a $1Tn program.
In response to the proposed impositions, the cryptosphere mounted a Herculean challenge to the provision’s inclusion that shook at the foundations of the most hallowed halls in the land. From major firms and pro-crypto politicians to retail investors, tireless efforts were expended to strike the provision from the bill, resulting in a last-minute amendment requiring unanimous support to pass. When the time came, however, 87-year-old Republican senator Richard Shelby objected to the amendment, an apparent reaction to an earlier veto on the inclusion of an additional $50bn in defence spending, on top of the already exorbitant $700bn allocated to the US defence department for 2021. Refreshing at least to see that an old man used bitcoin as a tool towards his own ends, rather than simply yelling at technology.
Shelby’s was the sole objection from the cohort of 100 senators — evidence that crypto’s impact and relevance reaches beyond even the most searing divisions, as Senators voiced their support from both sides of the aisle.
While it may seem that the battle was lost earlier this week, BTC held steady on its run to $46k, from $41k just last Friday. Alongside BTC, ETH and other alts enjoyed sizeable gains, as a reinvigorated community responded positively to a united show of force that briefly brought the United States Senate to a standstill.
The path to maturation is paved with battles of this magnitude, as both regulators and crypto maximalists attempt to reach agreement on matters of tax compliance, oversight, privacy, and the need to uphold individual sovereignty in a space built to affirm that exact principle.
If anything, the Infrastructure Bill debate proved in no uncertain terms that crypto is making its presence known in tectonic strides, backed by legions of believers determined to stay the course and realise the true potential of these controversial, yet undeniably beautiful, technological innovations.
