Summary: Even if Bitcoin payment technology improves, US tax treatment can still make routine BTC spending impractical because each payment may trigger capital gains reporting.
What changed
Pierre Rochard, a board member at Bitcoin treasury company Strive, argued that tax policy – rather than transaction speed or fees – is a main obstacle to broader Bitcoin payments adoption.
Why taxes are a bottleneck for payments
In US tax practice, virtual currency is treated as property. That means exchanging or using BTC for goods or services can be a reportable disposition that may generate a capital gain or loss. The recordkeeping burden is one reason advocates argue Bitcoin is harder to use as everyday money.
What lawmakers have proposed
Sen. Cynthia Lummis (R-Wyo.) introduced digital asset tax legislation that includes a $300 de minimis rule aimed at reducing the need to track gains on small transactions. The proposal also includes a $5,000 yearly cap and describes an inflation adjustment beginning in 2026.
What advocates are warning about
Representatives of the Bitcoin Policy Institute (BPI) have warned that any de minimis relief could be limited to stablecoins, leaving everyday Bitcoin transactions without an exemption.
Key takeaways
- Tax treatment can be a bigger practical constraint on payments than settlement technology.
- A de minimis rule is meant to reduce reporting friction for small transactions.
- Stablecoin-only exemptions would not address Bitcoin’s small-transaction reporting burden.
References (primary and official)
- Taxpayer Advocate Service (IRS): Report your virtual currency transactions
- Sen. Cynthia Lummis press release (July 3, 2025): Lummis Unveils Digital Asset Tax Legislation
- Bill text PDF (linked by Senate office): Lummis-Crypto-Tax-Bill.pdf
Additional reporting
- Cointelegraph (Dec 18, 2025): US lawmakers exclude BTC from de minimis tax exemption: BPI
- TradingView syndication: Bitcoin payments held back by tax policy, not scaling tech: Crypto exec
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