You heard it right: the woman known as that Crypto Senator is at it again, with her latest proposal to further strengthen and build adoption for already popular retail transactions via cards and other means. Let us be honest, no one is filling out tax forms when buying a coffee with Bitcoin, so the current system is utterly idiotic. When rules are this impractical, industry and consumers alike just shrug and ignore them, treating the law like background noise.
The reality is, enforcing tax reporting on these micro-transactions is a logistical nightmare. Every Bitcoin spend, no matter how small, is technically a taxable event under the IRS’s “property” classification, requiring users to track cost basis, calculate gains or losses, and report it all. For a $5 smoothie or a $15 Uber ride? Good luck. Most people don’t have the time or patience, and the IRS lacks the resources to chase down every small-fry transaction.
Crypto’s pseudonymous nature makes it even trickier, wallets aren’t always tied to real-world identities, and tracking thousands of tiny peer-to-peer payments across decentralised networks is like herding cats. Platforms like Moonpay and Gemini are already making retail crypto payments slick and widespread, and users are happily bypassing the tax hassle, either out of ignorance or defiance. The industry isn’t waiting for lawmakers to catch up, not under a crypto-friendly Trump administration.
That’s why we must applaud Senator Lummis for her proposal. She’s drafting legislation for a de minimis tax exemption on small Bitcoin transactions, exempting purchases under roughly $300 from capital gains reporting and taxation, with an annual cap of $5,000 per person. This would exclude assets sold for cash equivalents or used in business operations but cover most casual spending, like that daily latte or grocery run. It builds on her earlier July push for broader digital asset tax reforms, including this $300 threshold to recognise the impracticality of tracking every micro-transaction. The move, inspired partly by Jack Dorsey’s call for everyday Bitcoin usability, aims to treat BTC more like fiat for routine payments, ditching the IRS’s clunky “property” classification that turns every spend into a taxable headache. Critics like Senator Elizabeth Warren argue it could open doors to tax evasion, but the status quo already drives non-compliance anyway, people are just doing it under the table.
When all is said and done, the fusion of crypto builders and pro-crypto politicians is what will take crypto to the moon where it belongs. Lummis’ plan would simply bring the law in line with what’s already happening: crypto’s becoming everyday money, and no one’s got time for a tax form with their coffee.