Ron Hammond, Director of Government at the Blockchain Association, provided a detailed update on the upcoming events for the crypto market in the current week. Sharing insights on X, Hammond emphasized that “the most pro-crypto Congress is here, and they’ve got work to do,” setting the stage for significant legislative activity over the next two years.
Key Events For Crypto Market This Week
Congress is beginning its session with planning meetings and other formalities, offering a brief lull before a surge in legislative and regulatory actions. “This week is relatively quiet,” Hammond noted, with preparations underway for major developments that could shape crypto policy. Key focus areas include nominations, committee leadership decisions, and initial groundwork for significant bills.
While market structure clarity dominated the last Congress, this year’s focus will shift to tax clarity. Hammond highlighted that the impending expiration of the Trump-era tax cuts has spurred interest in crafting a major tax bill. “Crypto faces many tax issues, from like-kind exchanges to charitable deductions,” Hammond stated. However, the most pressing concern is the IRS’s recently finalized broker rule.
1) This week in Congress and crypto: The most pro-crypto Congress is here, and they’ve got work to do. This month sets the stage for the next 2 years with big crypto bills, a major tax bill, nominations, committee chairs, agency actions, and more. Here’s what to watch:
— Ron Hammond (@RonwHammond) January 6, 2025
The broker rule, finalized in late 2024, stems from the 2021 infrastructure bill and expands reporting obligations to include DeFi platforms. The rule has faced backlash from the industry and lawmakers. “Despite heavy pushback, the IRS proceeded with its interpretation,” Hammond said, prompting immediate legal action from the Blockchain Association, DeFi Education Fund, and Texas Blockchain Council. Congressional intervention through a Congressional Review Act (CRA) is anticipated as bipartisan opposition grows.
Strategic Policy Debates in Crypto Circles
The crypto industry itself faces internal policy debates, particularly around priorities like token clarity and the establishment of a Bitcoin strategic reserve. Hammond noted, “While some in crypto policy see a strategic reserve as essential, others argue it’s not a fleshed-out policy.” These differing priorities could spark intense discussions within the industry.
Another notable development is the increasing involvement of traditional financial institutions (trad-fi) in crypto policy discussions. “While banks and funds have lobbied on crypto for years, their post-election outreach in DC has been staggering,” Hammond observed. Trad-fi’s expanding presence is expected to influence both policy and business dynamics significantly over the next two years.
Hammond concluded on an optimistic note, expressing excitement about his expanded role in fostering collaboration between the crypto and traditional financial sectors. “As crypto embraces the next wave of trad-fi investment, I’m excited to be leading the policy collaboration efforts in DC,” he stated.
The weeks ahead promise critical policy battles, including the broker rule CRA and tax-related legislation. These will likely define the trajectory of the crypto market’s future and the industry’s relationship with regulators and lawmakers.
Read the full article here
