Crypto’s hard lesson in official Washington’s ways
The Senate’s trillion-dollar infrastructure bill contains several measures that are supposed to pay for at least a portion of the spending on roads and bridges. Among those items is a change in tax reporting rules for cryptocurrencies that are supposed to raise $28 billion in tax revenue.
Crypto backers and industry representatives tried to stop the requirements, but failed. One reason, official Washington says, is the crypto kids just didn’t have the cash or connections they needed to avoid (or at least mitigate) government’s grip:
While industries like banking, housing and pharmaceuticals have longstanding ties to lawmakers and lobbying operations sometimes backed by eight-figure bankrolls, the cryptocurrency industry is just making itself known in the halls of Congress for the most part. Bitcoin, for example, has fervent enthusiasts, but it has existed only since 2009 and many voters still don’t know much about it. Unlike other industries — where there’s a bank, real-estate agent and pharmacy in every district — lawmakers can’t always point to a constituent who supports cryptocurrency.
“What the industry was able to do once it was up against the ropes was impressive, but from a tactical perspective the goal is to avoid getting pinned against the ropes altogether,” said Isaac Boltansky, a policy analyst with investment firm Compass Point Research & Trading.
Crypto advocates say the Senate defeat shows the need for more organization and money as the burgeoning industry increasingly catches policy makers’ attention.
And so it goes for every industry, whether rooted in the old economy, or on the bleeding edge of the next: Washington wants its cut. And if that new industry doesn’t mount a round-the-clock defense of itself in the halls of Congress and the conference rooms of assorted departments, then the hammer will fall. It may fall even with a full-blown lobbying effort. No matter. Play the game, or get played.
That is the state of our democracy.