US Treasury, IRS propose cryptocurrency regulations for brokers
Two United States federal agencies — the Department of the Treasury and the Internal Revenue Service (IRS) — have released a set of cryptocurrency regulations proposal detailing brokers’ reporting requirements.
The Office of Advocacy of the U.S. Small Business Administration revealed that the proposal around crypto regulations for brokers was released on Aug. 29. It explained:
“The proposed rules would require digital asset brokers, including trading platforms, payment processors, and certain hosted wallet providers, to report gross proceeds for all sales or exchanges of digital assets starting on January 1, 2025.”
Brokers — referred to as “digital asset middlemen” in the regulatory proposal — will also be subject to providing information on gains and losses incurred during the sale of crypto assets. However, this requirement will kick in on or after Jan. 1, 2026.
According to a related document shared over the Federal Register, the proposed regulations are expected to deliver “higher levels of taxpayer compliance” as the IRS would get greater clarity on the income earned by taxpayers.
The Treasury Department and the IRS have invited small businesses in the U.S. to share how the regulations would impact them, which will be supported by a public hearing scheduled for Nov. 7, 2023.
Once signed into law, the regulations will require all brokers in the U.S. to file information returns with the IRS using the new Form 1099-DA and to provide payee statements to customers.
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The United States Government Accountability Office, a congressional watchdog agency, released a 77-page report highlighting the need for stricter regulations around cryptocurrencies.
Blockchain technology—like #cryptocurrency—could offer faster, cheaper financial transactions. But recent price crashes & bankruptcies have raised concerns about gaps in federal regulations that could put consumers at risk. Our new report & video explore: https://t.co/1vyIgZVaYi pic.twitter.com/nxHrk1g5dQ
— U.S. GAO (@USGAO) July 24, 2023
The report identified the spot markets for nonsecurity crypto assets as the center of a regulatory gap and stated:
“By designating a federal regulator to provide comprehensive federal oversight of spot markets for nonsecurity crypto assets, Congress could mitigate financial stability risks and better ensure that users of the platforms receive protections.”
On the other hand, traditional assets in that category enjoy robust regulation, the report noted.
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Safeguarding minister Jess Phillips has told Sky News that councils that believe they don’t have a problem with grooming gangs are “idiots” – as she denied Elon Musk influenced the decision to have a national inquiry on the subject.
The minister said: “I don’t follow Elon Musk’s advice on anything although maybe I too would like to go to Mars.
“Before anyone even knew Elon Musk’s name, I was working with the victims of these crimes.”
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Elon Musk. Pic: Reuters
Mr Musk had called Ms Phillips a “rape genocide apologist” in one of a series of inflammatory posts on X in January and said she should go to jail.
Mr Musk, then a close aide of US President Donald Trump, sparked a significant political row with his comments – with the Conservative Party and Reform UK calling for a new public inquiry into grooming gangs.
At the time, Ms Phillips denied a request for a public inquiry into child sexual exploitation in Oldham on the basis that it should be done at a local level.
But the government announced a national inquiry after Baroness Casey’s rapid audit on grooming gangs, which was published in June.
Asked if she thought there was, in the words of Baroness Casey, “over representation” among suspects of Asian and Pakistani men, Ms Phillips replied: “My own experience of working with many young girls in my area – yes there is a problem. There are different parts of the country where the problem will look different, organised crime has different flavours across the board.
“But I have to look at the evidence… and the government reacts to the evidence.”
Ms Phillips also said the home secretary has written to all police chiefs telling them that data collection on ethnicity “has to change”, to ensure that it is always recorded, promising “we will legislate to change the way this [collection] is done if necessary”.
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Operation Beaconport has since been established, led by the National Crime Agency (NCA), and will be reviewing more than 1,200 closed cases of child sexual exploitation.
Ms Phillips revealed that at least “five, six” councils have asked to be a part of the national review – and denounced councils that believed they don’t have a problem with grooming gangs as “idiots”.
“I don’t want [the inquiry] just to go over places that have already had inquiries and find things the Casey had already identified,” she said.
She confirmed that a shortlist for a chair has been drawn up, and she expects the inquiry to be finished within three years.
Ms Phillips’s comments come after she announced £426,000 of funding to roll out artificial intelligence tools across all 43 police forces in England and Wales to speed up investigations into modern slavery, child sex abuse and county lines gangs.
Some 13 forces have access to the AI apps, which the Home Office says have saved more than £20m and 16,000 hours for investigators.
The apps can translate large amounts of text in foreign languages and analyse data to find relationships between suspects.
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