Crypto Taxation: Urgent Calls for Clarity Before Year-End

With Thanksgiving this week, the 2026 tax season could start to play a factor across the economy.

We usually see tax loss harvesting when investors dump losing stocks in December.

And as the holiday shopping season gets underway, the 2026 tax season could be on the back of consumers' minds.

Well, with increased crypto rewards, blockchain building, and digital asset treasuries, the crypto industry is.

For clarity on taxes.

Well, joining me this morning to weigh in is Kristen Smith, president of the Solano Policy Institute.

Good morning, Kristen.

Thank you so much for joining us.

Well, last week, the Solano Policy Institute helped send a joint letter to President Trump on actions federal agencies can take on crypto clarity.

So take us through this and what is the core message and tell us why you're sending this letter now.

Well, good morning, Rey.

First of all, yes, we were a part of a group of over 65 leading crypto organizations last week that joined together to lobby the Trump administration for some action on taxes and developer protections before the end of the year.

I mean, first of all, I would be remiss if I didn't say this administration has been incredibly friendly towards crypto, and we have seen unprecedented action out of the administration, but what the what the Trump The Administration did over the summer is they released a report, this executive order report that serves as a roadmap for all of the steps that need to happen everywhere from Congress to the banking regulators to securities markets to the IRS.

And so one of the things that we wanted to do as an industry was to provide support for that agenda and urge them to take action on items specifically around taxation because as you said, this is an area where there is a lot of.

Confusion and if we don't have the right tax structures, particularly around things like mining and staking, it's going to make it harder for this infrastructure to be located here in the US.

It will be a bit less competitive compared to other countries.

And so this is something that now that the government has reopened, that these agencies and the IRS in particular can take action without Congress.

And so we're hopeful that the administration will be able to push forward on some of these items before the end of the year.

And Kristen, building on what you just said, what clarity do developers as well as builders actually need to see so they can stick with American blockchains?

You know, if you think of something like the Solana blockchain, one really important part of the blockchain is the way in which it's secured, and in this case this is through a proof of state mechanism.

And for those Uh holders of Sallana tokens that choose to stake those tokens, they get rewards that are created for their role in securing the blockchain.

Today those are rewards are created as income, and we think that that is something that should be treated more like newly created property, which would mean, and then we also need the timing to change so that they're not taxed immediately but that they're taxed. upon sale and because what this does is this would force sort of early selling so that people can cover their tax liabilities.

So this is something this treatment would be akin to the way most agricultural products or sort of any situation where you have this newly created property, it would be taxed at a later time.

So this is something the IRS can do unilaterally.

They do not need an act of Congress in order to provide this level of guidance.

And finally, Christina, before I let you go, Mike Celig has had a confirmation hearing with the Senate, so give us your thoughts on SEEG as a potential CFTC chair.

Yeah, well, the Commodity Futures Trading Commission is an incredibly important market regulator for the derivatives markets, and it's often viewed as potentially the future home for regulation of cryptospo markets.

And the problem with the CFTC is that it hasn't had a full slate of commissioners or a confirmed chair. in nearly a year now.

And so Mike Selig is incredibly talented.

He's currently at the SEC.

He was nominated by the president and just this last week, the Senate Agriculture Committee both held a hearing and a vote to pass him on to the full floor.

So we're hopeful that the full Senate will be able to vote.

Uh, on his, uh, nomination and get him over, uh, to the CFTC because there are a lot of important regulations under play around crypto derivatives, perpetuals, prediction markets, and we want to make sure that there is somebody at the helm of that agency in order to shepherd these important regulations forward.

OK, Kristen, always wonderful to talk to you.

Thank you so much for joining us this morning and have a happy holiday season.

All right, great.

Thanks, Remy.