The US House of Representatives is considering establishing a tax safe harbor for stablecoins and crypto asset pledging, and clarifying the tax system's definition.

On December 22, according to Zhitong Finance, bipartisan members of the U.S. House of Representatives are working together to draft a cryptocurrency tax framework. This framework would provide a safe harbor for some stablecoin transactions and defer taxation on rewards earned through verifying blockchain transactions. While broader digital asset regulatory legislation is still under negotiation, the cryptocurrency industry remains eager to call for legislation clarifying the tax treatment of digital assets. Ohio Republican Representative Max Miller and Nevada Democratic Representative Steven Horsford have responded to these calls by drafting a bill to align cryptocurrency taxation with traditional securities. The draft, which includes the bill's text and policy objectives, proposes exempting transactions of regulated stablecoins with a long-term value between $0.99 and $1.01 from capital gains tax. The proposal also attempts to establish safe harbor rules for the distribution and processing of staking and mining rewards that involve blockchain transaction verification. The draft also includes cryptocurrencies in a tax system that covers securities transactions and some commodity transactions. Capital gains tax exemptions enjoyed by foreign investors trading securities through domestic third parties and by securities lenders will also apply to digital assets. (Source: Zhitong Finance)