Congress Advances Budget Bill Without Crypto Tax Reform

TL;DR:

• The U.S. Senate passed Trump’s budget bill without including crypto tax relief.
  
• Senator Cynthia Lummis’ amendment to ease taxation on crypto transactions was left out.
  
• The digital asset industry lobbied hard, but last-minute negotiations failed.
  
• The bill now moves to the House, where it faces further scrutiny.
  
• Crypto advocates now return to standalone legislation efforts.
  

Senate Passes Budget Bill Without Crypto Clarity

The U.S. Senate has narrowly passed a sweeping budget bill central to former President Donald Trump’s renewed federal policy strategy. However, the final version of the bill omitted a key amendment addressing cryptocurrency taxation, much to the disappointment of the digital asset industry and its legislative champions.

The proposed tax provision, championed by Senator Cynthia Lummis, aimed to waive capital gains taxes on small-scale crypto transactions. It was a high-priority measure for many in the Web3 ecosystem, which has long sought regulatory clarity and fairer tax treatment.

Despite overnight deliberations and 11th-hour lobbying from crypto industry stakeholders, Lummis’ amendment failed to receive the required floor vote as the Senate pushed the bill through on a 50-50 vote, broken by Vice President J.D. Vance.

Crypto Tax Reform Misses the Cut

The last-minute hope for reform emerged as part of the so-called “One Big Beautiful Bill”, a legislative package designed to fund and enact Trump’s federal vision for defense, border security, and tax restructuring.

While many amendments were debated deep into the night, Lummis’ crypto tax proposal was excluded from the vote slate, a clear setback for the industry’s progress on Capitol Hill.

“It’s a missed opportunity to rationalize our tax system,” said a crypto lobbyist involved in the late-stage talks. “This would have made it easier for Americans to use crypto in day-to-day life.”

The proposed amendment focused on eliminating double taxation, and offered relief for transactions below a defined threshold, a long-sought fix by crypto users who face tax burdens for even minor purchases.

From Hope to Stalemate: Industry Reacts

The crypto industry’s disappointment is palpable. With lobbying efforts from major players like Coinbase, the Blockchain Association, and digital asset advocacy groups, there had been optimism that Lummis’ proposal might slip into the final language of the bill.

That optimism faded early Tuesday as procedural rules and political calculus excluded the amendment from the final negotiations. Standalone legislation—already introduced by Lummis in the past—now remains the only pathway forward.

“Senator Lummis has been consistent in her push to make digital assets more practical under U.S. tax law,” one Capitol Hill source told CoinDesk. “But this wasn’t the vehicle.”

Crypto Tax Reform in Congress

Bill Advances to the House, Debate Awaits

The budget package now moves to the U.S. House of Representatives, where Trump-aligned Republicans are expected to defend the measure. However, the bill is likely to face fierce debate, as the House only narrowly passed its version weeks ago.

The legislation proposes a $3 trillion deficit increase over the coming decade. Supporters argue that this is a necessary investment in national strength, energy dominance, and tax relief. Critics call it fiscally irresponsible.

House Speaker Mike Johnson has not yet announced when the House will vote on the Senate version.

GOP Celebrates, Democrats Condemn

Senate Majority Leader John Thune praised the vote, calling the legislation a “bold restructuring of federal priorities.”

“We are extending tax relief for hard-working Americans, rebuilding our military, securing our borders, and unleashing American energy,” Thune said on the Senate floor.

In contrast, Senator Elizabeth Warren denounced the bill as a corporate giveaway, sending scathing letters to tech CEOs including Amazon, Meta, and Apple.

“You’ve spent millions cozying up to Trump and Republicans,” Warren wrote. “Now, they’re returning the favor with tax breaks—on the backs of working families.”

Treasury Pushes Forward

Newly appointed Treasury Secretary Scott Bessent urged the House to act swiftly to approve the Senate version.

“It’s time to deliver on President Trump’s promises and ensure the U.S. remains the global capital of innovation,” Bessent said in a post-vote statement.

His comments came amid growing concern that global capital markets are watching Washington closely for signals on crypto regulation and tax policy clarity.

What’s Next for Crypto Legislation?

For now, Senator Lummis will return to standalone efforts to pass her crypto tax exemption bill, originally co-sponsored by Senator Kirsten Gillibrand. The legislation remains alive in committee and could surface again as part of targeted financial reform packages later this year.

Despite this setback, the momentum for clearer crypto rules continues, driven by consumer demand and industry pressure.

“Crypto is no longer fringe. It’s part of the U.S. financial system,” a spokesperson for the Crypto Council for Innovation said. “Tax reform isn’t a matter of if — it’s when.”