Cryptocurrency amendment blocked in Senate

A bipartisan amendment to redefine who would be subject to new cryptocurrency regulation requirements under the Senate infrastructure bill was blocked Monday after Sen. Richard Shelby (R-Ala.) tried to attach his untreated proposal to boost military spending by $50 billion.

Sen. Pat Toomey (R-Pa.) put forward the amendment, which is co-sponsored by Sens. Mark Warner (D-Va.), Kyrsten Sinema (D-Ariz.), Rob Portman (R-Ohio) and Cynthia Lummis (R-Wyo.) and supported by the Treasury Department, and tried to get it added to the bipartisan infrastructure bill.

But after Shelby requested to add his amendment to boost military spending to the bill, it was blocked by Sen. Bernie Sanders (I-Vt.). 

Sen. Tom Carper (D-Del.) introduced the amendment again, but it was blocked by Shelby after Carper objected to tacking on Shelby’s amendment. 

Toomey expressed disgust that the amendment was stuck.

“Because there’s a difference of opinion on whether or not the senator from Alabama should get a vote on his amendment, because that is not agreed to, the body is refusing to take up an amendment that has broad bipartisan support, that we all know fixes something that badly needs to be fixed,” Toomey said on the Senate floor. 

“This isn’t like a whim of the senator from Pennsylvania. There’s like nobody who disputes that there’s a problem here,” he added. 

Toomey’s amendment would redefine “brokers” in the infrastructure bill in a way that aims to keep software developers and transaction validators from being subject to new reporting requirements laid out in the infrastructure bill. 

Cryptocurrency industry leaders have argued that the existing definition of “broker” under the infrastructure bill would rope in software developers and so-called miners to be subject to the new reporting requirements, despite the fact that they may not have access to the data they would be asked to report. 

Sen. Ted Cruz (R-Texas) fiercely pushed back on the original language, arguing that the “overly broad definition” would “block rapid innovation in cryptocurrencies” and “endanger the privacy” of Americans. 

Cruz attempted to get approval for a separate amendment to strike the language regarding cryptocurrency requirements from the bill. 

But Cruz objected to Shelby’s request to also add his defense amendment to the bill, leading Shelby to then block Cruz’s amendment

The compromise amendment put forward Monday followed a fierce debate last week over two competing amendments to redefine or carve out exemptions under the reporting requirements for cryptocurrency. 

Senate Finance Committee Chairman Ron Wyden (D-Ore.) had put forward an alternative amendment with Toomey and Lummis, but it failed to get support from the Biden administration. 

Wyden tweeted that the compromise amendment did not offer enough privacy and security protection but said it is “certainly better” than the language in the underlying bill. 

If senators are unable to secure another vote on the amendment without objection from a single senator, the infrastructure bill will be put forward for a vote with the existing language that industry leaders and some lawmakers have criticized.