Three major crypto trade groups are pressing Congress to pass a bill that would change how mining and staking rewards are taxed. The problem? Time is running out, and Democrats aren’t sold on it.
The legislation — called the Tax Clarity for Mining and Staking Act — would exempt newly mined crypto and staking rewards from being counted as taxable income. Right now, if you mine or stake crypto in the U.S., the IRS treats those rewards as income the moment you receive them, whether you sell them or not.
The Blockchain Association, the Crypto Council for Innovation, and the Digital Chamber sent a joint letter to the House Ways and Means Committee this week, arguing that reopening negotiations would “risk reviving the very problems the bill resolves.”
But House Democrats aren’t buying it. They’ve warned the bill could make crypto more attractive than traditional investments like stocks and bonds, potentially reshaping financial markets in ways they’re not comfortable with. The committee’s top Democrats have said they don’t expect any crypto tax bills to pass before November’s midterm elections.
And that’s the real problem. With midterms approaching and Democrats favored to retake the House, the window for crypto-friendly legislation is closing fast. If the bill can’t pass before the election, it might not get another shot for a long time.
The Senate’s broader Clarity Act — which would formally legalize most crypto activity by reshaping securities laws — faces a similar timeline. If it can’t pass by August, its sponsors say it’s unlikely to become law for the foreseeable future.
The crypto industry isn’t giving up yet. The Digital Chamber plans to bring nearly a dozen member companies to Capitol Hill to lobby in person. Whether that’s enough to move the needle before the midterms is an open question.
