The bipartisan infrastructure bill is currently in the discussion today. Since this would be a new regulation for the crypto market, it has a potential effect on the crypto sector. As many blockchain projects and investors try to join the hype in crypto and other digital assets, there is also an increasing number of fraudsters, tax evaders, and money launders. To help resolve the expanding illegal activities in the crypto market, different countries are now making moves by introducing new regulations, like the MiCA Regulation in Europe and Bipartisan Infrastructure Bill in the US.
Let’s talk about this bill in this blog and whether it will launch a bull run in the market or not.
What is Bipartisan Infrastructure Bill?
The Bipartisan Infrastructure Bill, a plan agreed in principle with President Biden, puts forward $28 billion in crypto tax enforcement collection via projections from the Joint Committee on Taxation. Legislators are considering increasing IRS reporting requirements for digital assets, including cryptocurrencies, to help fund legislative projects.
The description of the provisions of the bill includes making explicit that broker-to-broker disclosure within the meaning of Section 6045(g)(3) of the Code is applicable to digital assets and amending the definition of “broker” to include trading platforms related to the trading of digital assets. The final proposal would require companies to disclose cash transfers of $10,000 or more when they receive digital assets. This is not yet publicly accessible, but a summary draft is known as the “Bipartisan Infrastructure Investment and Jobs Act”, claims that these key elements have been defined and are under discussion.
What’s the effect?
Cryptocurrency investors, consumers, and broker-dealers who utilize cryptocurrencies for the exchange of products or any other kind of payment would be under huge reporting obligations as a result of these rules. With this bill, they would be mandated to disclose all their activities related to cryptos.
Will Bipartisan Infrastructure Bill launch a bull run in the market?
This is a good question, but the answer relies on how investors, consumers, and brokers perceive the new regulation. Two scenarios could happen. If the market will consider this regulation as something to add up to the current level of security in the crypto market, there’s a chance that more people would be encouraged to invest, which means the market would be positive again. If the bill would bring a sense of safety and security, especially to investors, then a lot of people would want to get exposed to crypto.
On the other hand, this bill might be a limitation for investors, users, and brokers. Those who can’t comply with the requirements would not be able to enter the market, which means that the market would be limited to those who can afford to complete the requirements. In return, people who can’t keep up with new regulations would look for other sectors where there is more freedom when it comes to investing and similar activities.
A lot can happen after this bill is finalized. Right now, what we know is that it would require a bigger responsibility from investors and brokers. If successfully finalized, existing users and brokers should comply with the rules. Let’s wait and see what would happen in the next months.