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PANews reported on October 9th that according to Bloomberg, asset management firm Eurizon SLJ Capital Limited stated that growing market resistance to major reserve currencies like the US dollar is driving gold and Bitcoin prices to record highs, and the upward trend is expected to continue. Earlier this week, gold broke through $4,000 per ounce for the first time, and Bitcoin also hit a new high. Eurizon strategists pointed out that the two gains are driven by "common factors." Central banks are "printing money frenzy" and investors are turning to alternative assets. Strategists believe that if reserve institutions continue to sell fiat currencies, gold prices may continue to rise, and if gold reserves reach parity with the US dollar, the price of gold may reach $8,500. Eurizon predicts that the US dollar will continue to decline after a brief respite. The previous gains were due to the weakening of the euro and yen due to domestic political and fiscal risks, rather than the increasing appeal of the US dollar itself.

On October 1, 2025, the U.S. Senate Finance Committee held a hearing titled "Examining the Taxation of Digital Assets," chaired by Committee Chairman Mike Crapo. Participants included representatives from policy research, legal practice, trading platforms, and industry associations. Considering the evolution of U.S. digital asset tax policy and the current state of the crypto tax system, this meeting served as both a focused expression of existing industry demands and a reflection of future regulatory trends. The findings from the discussions on key topics such as digital asset reporting obligations, cost basis determination, and tax treatment will serve as important references for subsequent regulatory rulemaking and congressional legislation. 1. Broad Topics: An Overview of Views from All Sides of the Hearing 1. Small tax exemption Topic: Current tax laws require taxpayers to track and report all digital asset transaction gains. Should a tax-free threshold be established for low-value transactions (e.g., under $200) similar to the provisions of Section 988 of the U.S. Internal Revenue Code regarding foreign currency transactions? Main points: Jason Somensatto (Coin Center) pointed out that crypto payments are treated as assets for tax purposes, forcing users to calculate cost basis and capital gains every time they purchase goods or pay fees, making it almost impossible to manage. He believes that introducing a de minimis tax exemption would make crypto assets viable for retail payments, arguing that a mature framework for foreign currency transactions already exists and extending its application would not weaken the tax system. Lawrence Zlatkin (Coinbase): From a compliance perspective, Coinbase processes billions of microtransactions annually. Calculating revenue on a transaction-by-transaction basis would prevent both the platform and its users from meeting disclosure requirements. He believes establishing thresholds is a necessary step to reduce friction in the system. Andrea S. Kramer (ASKramer Law): She opposed the proposal from a legal consistency perspective, noting that IRC §61 explicitly states that "income from all sources" is taxable, and that exemptions must have a clear legal basis. She expressed concern that small exemptions could become a channel for tax avoidance, as tax authorities would have difficulty distinguishing between split transactions and actual payments. Sen. Elizabeth Warren (Senator): Adding to the fiscal impact, she believes that large-scale exemptions could result in billions of dollars in lost revenue, which is equivalent to an implicit subsidy to the crypto industry. Mike Crapo (Chairman): I believe the core of the problem lies in enforceability rather than concept, and we should study technical solutions that can both reduce the compliance burden and prevent circumvention. 2. Taxation timing for mining and staking rewards Topic: Current IRS guidance (Notice 2014-21) stipulates that income from virtual currency mining should be included in income "when acquired." With the increasing prevalence of staking mechanisms, the question of whether this should be adjusted to tax upon disposition has become a hot topic. Main points: Lawrence Zlatkin (Coinbase): Advocates for deferred taxation, noting that most staking reward tokens have no secondary market or liquidity when acquired, and that immediate taxation would create “phantom income” and violate the spirit of the tax law’s realization principle. Jason Somensatto (Coin Center): Added that the value of staking rewards fluctuates wildly, and the IRS lacks the ability to determine a valuation, making taxing them at the time of receipt neither fair nor workable. Andrea S. Kramer (ASKramer Law): Citing IRC § 451 and related precedent, she emphasized that a taxable event occurs when a taxpayer acquires complete dominance and control. She argues that deferring taxation creates new timing arbitrage opportunities. Annette Nellen (AICPA): A technical compromise solution is proposed, in which the Ministry of Finance can establish a "safe harbor" to determine the tax payment time based on the liquidity and lock-up period of the token and require disclosure. Sen. Bill Cassidy, Sen. Hassan: Inquiring whether the IRS can objectively judge liquidity, the answer was that the industry could provide price sources and locked position data. 3. Information reporting and broker definition Topic: The Infrastructure Investment and Jobs Act (IIJA, 2021) requires "broker-dealers" to report digital asset transaction information to the IRS, but the Treasury Department's proposed rules include DeFi protocols, non-custodial wallets, and code developers, sparking controversy. Main points: Lawrence Zlatkin (Coinbase): Coinbase supports third-party reporting, but if the definition is too broad, the IRS will receive a flood of noisy data and be unable to identify true risks. He suggested starting with custodial platforms and then gradually expanding. Jason Somensatto (Coin Center): From a constitutional and privacy perspective, I believe that requiring decentralized protocols to report goes beyond the authorization of the Bank Secrecy Act (BSA) and violates the protection of the Fourth Amendment. Andrea S. Kramer (ASKramer Law): Emphasizes that regulatory targets should focus on intermediaries that can control the flow of funds, otherwise the implementation costs will be too high. Sen. Maggie Hassan: She believes that without widespread reporting, the IRS will not be able to establish a traceability system, and the risk of tax base loss will be greater. Ron Wyden (Ranking Member): The summary states that Congress needs to find a new line between transparency and enforceability. 4. Wash sale rules and tax avoidance risks Topic: Current wash sale rules apply to securities but not digital assets. Investors can create losses and deduct taxes by quickly selling and then buying back. Main points: Sen. Chuck Grassley: Suggests that rules should be extended to digital assets to prevent abuse. Andrea S. Kramer (ASKramer Law): noted that the high volatility of the crypto market makes tax harvesting more likely to occur, and that expanding the rules is a necessary step to maintain fairness. Annette Nellen (AICPA): She believes that digital asset transaction records are transparent and technically traceable, and therefore this rule is also applicable. Lawrence Zlatkin (Coinbase): We remind you to assess the market impact and that forcing a delay in the repurchase period could weaken liquidity. Jason Somensatto (Coin Center): Added that if the rules are expanded, the IRS needs to publish both calculation and reporting guidance to avoid implementation confusion. 5. Mark-to-Market Pricing and Valuation Issue: Should actively traded digital assets be subject to a mark-to-market system, such as IRC §475 or §1256, to increase transparency and reduce deferrals? Main points: Annette Nellen (AICPA): Supports expansion, arguing that mark-to-market pricing can eliminate valuation lags and improve tax matching; recommends limiting it to assets with high liquidity and publicly available price sources. Andrea S. Kramer (ASKramer Law): I believe that it can be implemented first at the institutional investor level, and then promoted after observing the implementation effect. Ron Wyden (Ranking Member): We are concerned about whether the IRS can establish an authoritative price source database. Nellen promised that the AICPA can assist the industry in jointly developing it. 6. Stablecoins and payment compliance Topic content: Stablecoins are frequently used in payments and settlements. Should capital gains tax be exempted for small payments? Main points: Lawrence Zlatkin (Coinbase): He believes that stablecoins have minimal price fluctuations and it is unreasonable to tax them as property. Exemptions will help promote compliant payments. Jason Somensatto (Coin Center): In addition, circumvention can be prevented through limits and transaction record requirements. Sen. Elizabeth Warren (D-Va.) expressed concern that the exemption could be used to split large amounts of money and weaken reporting obligations. Mike Crapo (Chairman): We suggest exploring a low-risk transaction exception to balance enforceability and compliance. 7. Charitable donations and evaluation Topic: Under current rules, taxpayers who donate digital assets must submit a qualified appraisal. Should this requirement be exempted, similar to securities donations? Main points: Annette Nellen (AICPA): pointed out that actively traded assets already have public prices, and repeated evaluations are meaningless, so evaluations should be exempted to reduce costs. Andrea S. Kramer (ASKramer Law): I agree with the suggestion, but emphasize that illiquid assets still need to be evaluated to prevent valuation manipulation. Sen. Debbie Stabenow: Expressed support for Congress to study standardized valuation mechanisms to balance transparency and compliance efficiency. 8. Safe Harbor System Design Topic: Senators and witnesses repeatedly discussed the need for a "Safe Harbor" mechanism, designed to provide predictable and actionable compliance boundaries for specific transactions or behaviors. Participants agreed that the digital asset sector presents a high degree of technical complexity and valuation uncertainty, making it difficult to directly apply traditional standards to existing rules. Safe Harbor could serve as a transitional mechanism for institutional implementation. Main points: Annette Nellen (AICPA): She has repeatedly emphasized the "operability function" of the safe harbor. She believes that in the areas of staking and mining rewards, the safe harbor should clarify the timing of taxation: If the token liquidity is insufficient or there is a lock-up period, the revenue recognition can be delayed; If the tokens are immediately tradable, then the income is maintained. She also suggested creating safe harbors in the area of borrowing and source rules to allow taxpayers to determine whether a transfer is taxable. Lawrence Zlatkin (Coinbase): He advocates for the establishment of a safe harbor for digital asset lending, similar to IRC §1058, which clarifies the tax exemption for "transfers not for sale." He noted that the IRS currently lacks a clear definition of crypto lending, leading some loans to be mistakenly considered disposals. The safe harbor would help maintain market liquidity without sacrificing tax transparency. Jason Somensatto (Coin Center): He supports the introduction of a limited safe harbor for reporting and compliance, and recommends that the Treasury Department allow a technical transition period when implementing the new reporting system (1099-DA) to avoid misclassifying non-custodial wallets or parties to agreements as brokers. He emphasized that the safe harbor should be a "compliance incentive" rather than a permanent exemption. Andrea S. Kramer (ASKramer Law): While acknowledging the operational feasibility of the safe harbor, she cautioned that its scope must be strictly limited, otherwise it would effectively become an industry exemption. She suggested clarifying termination conditions, reporting obligations, and information disclosure requirements during its formulation. Mike Crapo (Chairman): In summary, the safe harbor mechanism may be an "institutional buffer" to achieve a balance between taxation and compliance, and should be further discussed in the legislative process, especially for the application scenarios of emerging assets and hybrid transaction structures. 9. International competition and cross-border rules Topic: Does an uncertain tax framework weaken the US's position in the global digital asset competition? How to define the source and taxation rights in cross-border pledges and lending? Main points: Sen. Cynthia Lummis: Pointed out that regulatory ambiguity has prompted companies to move to the European Union and Asia, and asked the Treasury Department and IRS to speed up the clarification of the system. Lawrence Zlatkin (Coinbase): What companies that need additional compliance most is regulatory certainty; otherwise, they will be forced to relocate their businesses. Jason Somensatto (Coin Center): I believe a stable tax system is a prerequisite for attracting long-term investment. Annette Nellen (AICPA): It is suggested that unclear source rules for cross-border pledges and loans may lead to double taxation and should be aligned with OECD guidelines. Ron Wyden (Ranking Member): The summary states that the Finance Committee's task is to maintain both competitiveness and the integrity of the tax base. II. Background Review: The Evolution of the U.S. Crypto Tax System In recent years, as the scale of digital asset transactions has continued to expand, the attention and scrutiny of US tax authorities has intensified. A 2024 report by the Internal Revenue Service's Inspector General (TIGTA) noted that IRS tax assessments in income tax audits involving digital asset transactions had increased from approximately $508,000 in fiscal year 2022 to over $12.2 million by May 2023. This trend not only demonstrates the increasing importance of digital assets in taxpayers' economic activities but also highlights the pressures facing the current tax system in adapting to this emerging asset class. In line with the expansion of the digital asset market, US tax policy has evolved over time, not overnight. Since first defining virtual currencies as property in 2014, the IRS has issued regulations addressing hard forks, airdrops, information disclosure, and broker-dealer reporting obligations, gradually establishing a framework for addressing these emerging assets. To date, the US crypto tax system has formed a relatively comprehensive system based on existing regulations. Qualitatively, virtual currencies are considered property (Notice 2014-21), requiring the calculation of cost and fair value for sale, exchange, or daily consumption, and the recognition of capital gains or losses. On the income side, mining, staking rewards, airdrops, and other items are considered ordinary income and included in current income when earned. If considered as a business activity, they may also trigger self-employment tax. Regarding information reporting, the 2021 IIJA included digital assets in the broker-dealer reporting system. In 2024, the Treasury Department and the IRS introduced Form 1099-DA, requiring the reporting of total transaction amounts starting in 2025 and expanding to cost basis and profit and loss in 2026. It is important to note that the reporting of large digital asset receipts under Form 8300 (§6050I) remains suspended. In terms of preferential treatment and exceptions, long-term holdings can enjoy a lower capital gains tax rate, and qualified charitable donations can be deducted, but there is no small tax exemption policy (de minimis) similar to foreign currency transactions, and wash sale rules have not yet been extended to digital assets. Overall, the US digital asset tax system has evolved from an early vacuum to the establishment of a property-based approach, followed by the gradual expansion of rules, enhanced information disclosure, and the implementation of a broker-dealer system. For over a decade, the IRS has continuously responded to emerging crypto market trends such as forks, airdrops, mining, and payments, while Congress established the legislative basis for broker-dealer reporting through the Infrastructure Investment and Jobs Act. These changes have gradually brought digital assets from marginalized, shady transactions into the mainstream tax framework, but have also brought with them practical challenges such as increased compliance burdens and unclear institutional boundaries. On the one hand, the Treasury Department and the IRS have pushed for the implementation of 1099-DA reporting rules, sparking heated debate in the process. The question of whether some non-custodial entities should be subject to "broker-dealer" obligations remains unresolved. On the other hand, proposals within Congress, such as a "small amount tax exemption" and the extension of the "wash sale rule" to digital assets, or public comment solicitations, indicate that lawmakers are seeking a balance between expanding the tax base and reducing the burden. This hearing is both a response to the past decade's institutional evolution and a prelude to the future direction of crypto taxation. 3. Potential Impact: Will the US Crypto Market Welcome Better Tax Policies? This hearing was not only a profound technical discussion but also a strategic dialogue on the position of digital assets in the US tax system. Behind these specific topics—small-value payment exemptions, the taxation timing of staking and mining, the boundaries of information reporting, and the scope of wash sale rules and mark-to-market—are three deeper contradictions: Innovation vs. Fairness: The industry hopes to reduce compliance costs and tax uncertainty to promote the implementation of new models such as payment, lending and pledge; policymakers are worried about excessive concessions that will undermine the consistency of the tax system and fiscal fairness. Transparency vs. Privacy: The IRS requires third-party reporting to understand the true transaction network, while the industry and some lawmakers worry that attempts to expand this to DeFi and non-custodial entities may not be technically feasible and erode user privacy. United States vs. the World: If U.S. rules remain vague for a long time, capital and innovation will shift to Europe and Asia; lawmakers reminded that the United States cannot pursue "competitiveness" at the expense of its tax base and fiscal stability. From a policy perspective, in the short term, Congress may engage in further consultations on highly controversial issues such as small-value payment exemptions, the timing of pledge taxation, and lending safe harbors. In the medium term, whether wash sale rules and mark-to-market pricing are extended to digital assets will be the key to filling tax loopholes. In the long term, the reconstruction of the broker definition and information reporting framework will determine whether the IRS will obtain an enforceable digital asset compliance system or continue to vacillate between insufficient data and limited law enforcement. It's foreseeable that the US digital asset tax system is at the intersection of patchwork repairs and systemic restructuring. While this hearing may not lead to a legislative breakthrough, it will certainly bring core contradictions to the fore. In the coming years, how the US finds a sustainable balance between expanding its tax base and supporting innovation will not only influence the direction of its own tax governance but also shape the path of compliance in the global crypto market.