Overview

• Coinbase tax chief Lawrence Zlatkin told senators the IRS is likely unprepared for the torrent of data from new broker reporting, warning that billions of transactions will test the system.
• Committee members pressed on unsettled issues including a de minimis threshold, when staking rewards are taxed, and whether stablecoin gains should be excluded, with Senator Cynthia Lummis backing a $300 exemption proposal.
• Democrats questioned industry requests for special treatment, with Senator Elizabeth Warren warning exemptions could enrich crypto billionaires and reduce revenue, and some lawmakers suggesting staking rewards be treated as earned income.
• Reports of IRS staffing cuts and turnover in its crypto office, including the departure of Trish Turner, heightened concerns about the agency’s capacity to implement and enforce the new regime.
• The hearing followed initial IRS guidance some companies say could limit CAMT exposure on unrealized crypto gains, a tentative step praised by Michael Saylor’s firm and miner MARA but not yet final policy.