Infrastructure Bill’s ‘Unworkable’ Cryptocurrency Surveillance Mandate Must Be Amended

Sen. Rob Portman, R-Ohio, introduced a measure into the infrastructure bill last week intended to increase financial surveillance that could backfire and simply drive an entire industry offshore while putting the personal data of tens of millions of Americans at risk.

The measure was intended to assuage Republican concerns about the bill’s mammoth price tag, but it may ultimately raise very little, if any, money, since it merely reiterates existing reporting obligations for brokers while potentially mandating new requirements for entities that cannot possibly comply. This led Sen. Pat Toomey, R-Pa., to characterize the measure as “unworkable.”

In fact, the measure is not a new tax on cryptocurrency. Rather, it is a surveillance mandate intended to target brokers who are already required to report customer transactions.

Unfortunately, as written, the mandate could also include entire swathes of the cryptocurrency industry such as miners, who do not hold custody of money or view customer details any more than your electric company does when you buy something on Amazon.com. These firms cannot comply—it is technologically impossible.