Who would have thought a once obscure, 13-year-old industry would have become one of the sticking points in a must-pass, trillion-dollar, generational infrastructure package?
Two things show that the blockchain and crypto industry have come of age. The first is that the industry was targeted in the first place in the original bill, however misguided and ill-informed the provisions were. The second is that the industry demonstrated its political weight by organizing a rapid and coordinated intervention that succeeded in producing amendments, and that thwarted provisions that should have been stricken altogether and debated as a part of a separate cross-sector discussion on harnessing exponential technology in the U.S.
As it stands, the infrastructure bill’s provisions relating to blockchain and cryptocurrency reporting appear to have survived review by the Senate, but members of the bipartisan Blockchain Caucus in the House are signaling their intention to reinvigorate the debate.
That crypto made it to the floor of the Senate at such a pivotal time shows that the industry has arrived—and the cost of arrival is the prospect of being taxed, regulated, and held to higher standards of accountability. It also underscores the perils of trying to buy political insurance when the house is on fire, and the fact that policy leaders often miss how public blockchains (and crypto more broadly) are necessary infrastructure to meet 21st-century needs and correct existing market failures.