By Andrew Gordon, Crypto Tax Attorney and CPA
Last week, I had the opportunity to attend the Bitcoin Conference 2024, an annual event that was hosted in Nashville for the first time this year. Compared to past years, this year’s BTC was a massive, thunderous gathering surrounded by hype, pomp, and a sense that change is coming. At times, the event felt more like a political rally than a digital asset conference.
Perhaps that’s to be expected. After all, Bitcoin is at an all-time high, it’s an election year, and the event featured an all-star guest list. This year’s BTC conference boasted a prominent speaker list that included politicians, celebrities, influencers, business leaders, and—most notably—two presidential candidates, with Donald Trump headlining.
It was perhaps the biggest, most publicized crypto event in history. But now that the dust has settled, what’s next? Will one historically popular event change anything for crypto investors?
My take is this: Cryptocurrency is now mainstream. It’s here to stay. After years of waiting, there is optimism that lawmakers will enact policy changes that finally follow public sentiment. With roughly 40% of Americans holding some form of crypto, the time for lawmakers to pass updated, crypto-friendly tax reform that is clear, fair, and equitable for investors is long overdue.
So with Bitcoin 2024 now in the books, here are some of my observations from the event, thoughts on what we can expect next, and what specific policy measures crypto investors should push for beyond speeches.
Politicians: We’re glad we have your attention
Whenever a major-party presidential candidate shows up, publicity will follow. Trump’s keynote address gave us a clearer picture of where the candidate stands on crypto: He pledged to make the U.S. the “crypto capital of the planet,” establish a strategic Bitcoin reserve, and fire SEC Chair Gary Gensler.
Trump’s position is a departure from his skeptical stance on cryptocurrency throughout his presidential term. This is progress! Much of the general public—even some who now consider themselves part of the crypto community—initially may have been wary of investing due to its volatility and complexity.
But it wasn’t just Trump: Among the speakers of political note were Robert F. Kennedy Jr., an Independent candidate for President; Vivek Ramaswamy, a former candidate for the Republican nominee who was shortlisted as a Trump VP candidate; and four current members of Congress.
What we see now is a sea change: Some politicians—mostly, but not solely, on the Right—have identified a growing movement, and want to attach themselves to the voters within it.
However, “I support crypto” is not enough.
Most of the intricacies of how crypto works—and more importantly, how it’s taxed—are still generally misunderstood, even among experts. We must continue to advocate for the swift, specific, and easy-to-understand tax policy changes that reward, rather than punish, the entrepreneurial spirit. More on that below!
Prominent politicians may have joined the tent, but now the real work begins.
What’s next? Tax reform is sorely needed
Crypto investors now have the ear of at least one of the two major political parties. Following the election this fall, a showdown next year over which direction crypto tax policy takes is almost certain.
So what does a “crypto-friendly” regulatory structure even look like? Well, we’re at an early stage in the dialogue, and thus far, any policy discussions have been largely disjointed and lack a comprehensive clear vision for how crypto will be taxed.
Before the event, I outlined my recommendations for crypto tax reform: We want reforms that bring clarity, fairness, and equitable treatment to our tax system. Change that allows the tax code to evolve with our rapidly growing crypto industry. You can read my complete list of proposals here at cryptotaxreform.com, but I’ll summarize why we need this reform below.
- The solution is not “get rid of Gensler” but instead, comprehensive crypto tax reform that impacts every investor.
- Most crypto investors have been unknowingly made into tax criminals. With the adoption of crypto investing at an all-time high, that’s a serious problem. It’s in the best interest of both the U.S. government and its citizens to have clear, easy-to-follow tax laws that make it easier for investors to be compliant, rather than IRS targets.
- Companies big and small often don’t know how to comply with the recently finalized broker regulations. A crypto tax guide that’s clear and easy to comply with is in the best interest of all parties.
In the regulatory changes to come, we have an opportunity for a win-win scenario. We need forward-thinking, fair tax reform that closes that tax gap while treating crypto investors with respect. Achieving that goal requires that crypto investors have a seat at the table when legislation is drafted.
Crypto is no longer a fringe or niche
It would be foolish to make sweeping proclamations about the future of crypto following a single conference, but I see BTC 2024 not as the catalyst for crypto’s rise in legitimacy, but rather a marking point of how far we’ve come.
Three presidential candidates speaking, BTC at an all-time high during the event, large companies (not just startups) joining in on the event floor, and record crowds—these are all markers that are greater than the sum of their parts.
Crypto can no longer be considered a fringe experiment or something relegated to the dark web; it is a major investment segment that now has the attention of some of the world’s most powerful people.
Much like watching your favorite indie band catch their big break and become a sensation, things are bound to change. When a niche becomes mainstream, the community and the conversations within inevitably change. That’s not a bad thing, it’s progress. If you’re reading this, you were likely an early adopter, and hopefully have seen financial gain from what others considered too risky.
Proposed “Bitcoin National Reserve” is a rising tide for all crypto
The U.S. Treasury has long held a portfolio of strategic assets such as gold, foreign currencies, and various commodities to maintain economic stability and the strength of the U.S. dollar.
At the BTC event, Trump, RFK Jr., and other politicians outlined similar plans to create a Bitcoin reserve, adding the cryptocurrency to the U.S.’s list of assets. So adding a strategic asset to the Federal Reserve’s balance sheet is nothing new, but adding a cryptocurrency—in these proposals, Bitcoin—to the mix would be a historic moment in cementing cryptocurrencies as a serious asset and long-term reserve of value.
Once Bitcoin and other forms of cryptocurrency are legitimized as an asset the U.S. government holds as a measure of its currency’s value, there will be no going back.
A reserve is a great idea and is likely to be positive for crypto investors. A strategic BTC reserve will further legitimize cryptocurrency, which will serve as a rising tide for all boats. However, a crypto reserve would raise tax and legal questions: Should Bitcoin receive favorable treatment over other cryptocurrencies? In 2014, the federal government determined that crypto was an asset, not a currency. If enacted, a crypto reserve could change that.
Legal questions aside, a strategic crypto reserve is a forward-thinking monetary policy position that bolsters crypto investors while modernizing the strength of the dollar, long-term.
But it’s more than a monetary policy decision: It’s putting a stake in the ground. The act of establishing a crypto reserve positions the U.S. as a leader, not a follower, in the digital economy. If the U.S. leads on this front, other countries will follow suit. However, if we fail to lead, someone else will.
Crypto has become a political issue, but it doesn’t have to be
Sadly, cryptocurrency has become a political issue that’s largely divided along party lines. That doesn’t have to be the case.
There are numerous reasons why crypto has become a political issue, and to delve into all of those reasons is outside the scope of this article.
Cryptocurrency was born out of technological innovation, a desire for financial freedom, and a vision of how future economies could operate. These are not Republican or Democratic ideals—they’re American ideals.
At the moment, Republicans have positioned themselves as the party most friendly to advancing regulation that makes sense for crypto investors. However, I’d encourage Democrats to become more active in the discussion and open to the life-changing possibilities of this revolutionary technology.
We need fair and clear tax reform that catches up with crypto’s advancement. We need both sides of the aisle to participate in creating laws that protect Americans who want to invest in new exciting opportunities, and who also just want to know how to stay compliant with the law.
Eventually, the political dialogue around crypto will dissipate as it becomes a more widely adopted and normalized form of investing. The politics around crypto will go away, but so will those who cling to it: Lawmakers who don’t embrace this change risk becoming relics.
We’re at a turning point: We can accept that crypto is a viable asset class that is here to stay and build practical laws around that future, or we can pretend it will go away.
I plan to put myself in the former camp. I invite you to join me.
Final thoughts
The Bitcoin 2024 event in Nashville was one of those events where you look around and realize how far crypto—particularly Bitcoin—has come in just over 10 years.
Crypto now has an energy and conversation unlike any I’ve seen since it first emerged. As crypto investors, we need to capitalize on this opportunity, demanding more than just support, but tangible change. It’s time to catalyze that energy to produce reform that works for all taxpayers.
