According to local media reports, the newly proposed laws in the United States have severe challenges for the crypto industry. Currently, the lawmakers are brainstorming over having a strong regulatory framework to keep a check on the crypto industry.
Reportedly, under the provisions of one such proposed law, the crypto businesses are required to collect personal information of users making digital asset transactions exceeding $10,000 for purchasing goods and services. Sources reveal that despite the controversy and disputes that surfaced this regulation is set to be implemented from January 1st next year.
Additionally, local media highlights that the regulation has also triggered some legal dispute between Coin Center, a crypto-focused non-profit organization, and the Treasury Department.
Notably, Coin Center has previously filed a lawsuit against the Treasury Department, arguing that the law violates individuals’ privacy rights and is unconstitutional in terms of monitoring. However, the case was dismissed by a judge who considered the harm to be speculative since the regulation was not yet enforced.
Despite this setback, Coin Center remains determined and plans to appeal the decision. However, the Department of Justice supports the regulation, claiming that it merely extends Congress’s authority to enhance tax compliance.
As per the sources, the reporting standards for crypto transactions will be aligned with those applied to cash transactions, requiring businesses to collect the names, addresses, and social security numbers of individuals making purchases. While some regulation proponents believe this measure will help combat tax evasion, critics express concerns about its potential implications on user privacy.
Some added that the law may also hinder certain businesses, like law firms, from accepting cryptocurrency payments without disclosing clients’ identities to the government. However, as the deadline draws near, the crypto community eagerly awaits further clarity and guidance on the regulation’s implications.
While the authorities across the globe are brainstorming over having a disclosure regime for crypto, the US has been leading the race with bringing some frameworks already. Earlier, in their budget the authorities had hinted at a disclosure regime for those holding over $50,000 worth crypto along with a regime for companies as well.
Additionally as the ongoing battle over regulations continues in the US, despite their imminent political divide, lawmakers strive to strike a balance between encouraging innovation and addressing illicit activities in the crypto space. In the past weeks, authorities have been actively engaging in crypto related discussions in their bids to comprehensively regulate the sector.