Biden Rejects Debt Deal Safeguarding Crypto Traders at G7

Joe Biden, the U.S President has taken a tough stand against a debt deal that could be beneficial to crypto traders.

The debt deal which according to the president is classified as “unacceptable” was made at a press conference with the Group of Seven (G7) in attendance.

According to Biden:

“A deal shielding wealth tax cheats and cryptocurrency traders threatens the food assistance of nearly 1 million Americans.”

He added further that the protection of crypto traders is bad business which he referred to as “tax-loss harvesting”

Meanwhile, a Washington Post reveals that the White House and Republican leaders are behind closed doors about putting a stop to the mechanism for cryptocurrency transactions.

What is Crypto Tax-Loss Harvesting?

Crypto tax-loss harvesting is aimed at reducing the overall tax liabilities of investors. This strategy requires the sale of cryptocurrency assets at a loss to offset capital gains from crypto profit. Although, proceeds from the sale must be used to acquire similar assets within 30 days or after the sale.

Additional Updates From the White House

Apart from the decision to end crypto tax-loss harvesting, the White House is persuading Republicans with a similar proposal that is likely to be detrimental to investors by barring them from putting off taxes on real estate.

According to the White House, this will be beneficial to the U.S. government by increasing tax revenue to $40 billion.

The Republicans strongly reject this proposal saying that the proposal is not addressing the right problem. According to the Post. House Speaker, Kevin McCarthy, the U.S. debt issue is a “spending problem, not a revenue problem.”

He further added that the spending problem can be traced to excessive spending by the Biden administration during the pandemic.

Meanwhile, the White House says that tax cuts from the previous administration gave rise to debts, claiming that the revenue has also been significantly affected in the process.

Republicans Coming to the Rescue

The Republican seems to be coming to the rescue as they seek to close the deficit with a sum of $4.8 trillion in spending cuts. Although, this might have a direct effect on the federal agencies’ budgets.

Meanwhile, if Congress fails to raise the debt ceiling, the U.S. government ouls default come June 1.

Since 1917, the debt ceiling refers to the limit Congress has set to how much money the government can borrow to pay bills.

Final Thoughts

The challenges facing crypto adoption and regulation will continue to make news for quite some time. This is because many developments such as its use cases and the volatile nature of the currency as well as reports on many rugs pulls keep the government wary of the currency.

While there are advantages to adoption, it is best to look at both sides of the coin to make an informed decision