U.S. Senator Cynthia Lummis introduced a standalone draft bill on Thursday aimed at modernizing the tax code for digital assets, just days after lawmakers passed a federal spending bill with no mention of crypto.
The Wyoming Republican’s proposal includes a de minimis exemption for crypto transactions and capital gains under $300, with an annual cap of $5,000. It would also defer taxes on mining and staking rewards until the assets are sold — rather than when they’re earned — and exempt crypto lending agreements and charitable contributions made in digital assets from taxation.
“This groundbreaking legislation is fully paid for, cuts through bureaucratic red tape, and establishes common-sense rules that reflect how digital technologies function in the real world,” Lummis said in a statement. “We cannot allow our archaic tax policies to stifle American innovation.”
The bill comes as digital asset advocates grow increasingly frustrated by what they see as a lack of clear and fair tax treatment in the U.S. The IRS currently treats most crypto events as taxable, even for everyday use cases, such as buying coffee with bitcoin.
Industry voices have long pushed for a de minimis exemption to avoid punishing small, routine transactions. Lummis’ bill appears to answer that call — at least partly — by allowing up to $5,000 annually in untaxed crypto gains under specific thresholds.
The move follows mounting pressure on lawmakers to address crypto taxation amid broader regulatory uncertainty. In June, House lawmakers introduced changes to the Digital Asset Market Clarity Act of 2025 that would exempt developers of decentralized protocols from being classified as money transmitters — reducing their tax and compliance burden compared to centralized platforms.
While the spending bill passed Congress this week without crypto language, lawmakers are reportedly scrambling to fold in last-minute provisions before it reaches President Donald Trump’s desk.
Lummis, a long-time crypto ally, now sees her standalone bill as the clearest path forward. It came barely six months after the U.S. House of Representatives voted 292-132 to overturn an IRS rule requiring crypto platforms, including decentralized finance (DeFi) entities, to collect and report taxpayer and transaction data.
Texas Democrat Lloyd Doggett warned that overturning the rule could benefit tax evaders and criminal networks, which could increase the national debt by $4 billion. The IRS argued that these measures are consistent with existing broker regulations and are not intended to discriminate against the DeFi industry.
