Bipartisan U.S. House lawmakers propose legislation to establish tax safe harbor for stablecoins and staking rewards

Bipartisan members of the U.S. House of Representatives are drafting a cryptocurrency tax framework, aiming to provide a safe harbor for certain stablecoin transactions and defer taxation on blockchain validation rewards. The draft, authored by Ohio Republican Representative Max Miller and Nevada Democratic Representative Steven Horsford, seeks to align the taxation of cryptocurrencies with that of traditional securities. The proposal suggests exempting capital gains tax on regulated stablecoin transactions whose value remains between $0.99 and $1.01 over the long term, and attempts to establish safe harbor rules for staking and mining rewards related to blockchain transaction validation. The draft would also include cryptocurrencies in the tax system that covers securities and certain commodity transactions, and the capital gains tax exemptions enjoyed by foreign investors and securities lending investors trading securities through domestic third parties would also apply to digital assets.