What’s next for crypto advocates

Marion Kozub

By CAITLIN OPRYSKO  08/13/2021 05:30 PM EDT Updated 08/13/2021 05:48 PM EDT 2021-08-13T05:48-0400 With Daniel Lippman WHERE DO CRYPTO ADVOCATES GO FROM HERE?: Following the cryptocurrency world’s high-profile, if unsuccessful efforts to extract changes in reporting requirements introduced in the bipartisan infrastructure bill the Senate passed this week, major players […]






Updated


With Daniel Lippman

WHERE DO CRYPTO ADVOCATES GO FROM HERE?: Following the cryptocurrency world’s high-profile, if unsuccessful efforts to extract changes in reporting requirements introduced in the bipartisan infrastructure bill the Senate passed this week, major players in the advocacy space say they plan to take a beat to recuperate before engaging allies in the House about revising the bill’s language — a step they acknowledge is far from guaranteed despite positive signals from lawmakers.

— At issue in the bill were new tax rules that would require cryptocurrency trading platforms and other entities defined as “brokers” to report transactions to the IRS. Advocates said they were blindsided by what they described as an overly broad definition of broker that could sweep up software developers and so-called miners who would find it impossible to comply with the requirements. “We are probably like everyone else trying to figure out what the process is going to look like” for amending the bill in the House, said Kristin Smith, executive director of the Blockchain Association, a key industry lobbying group.

— “I can’t say I have a fully formed plan of action that I can share,” added Jerry Brito, who leads Coin Center, a think tank that specializes in cryptocurrency policy, civil liberties and digital rights. He noted that “certainly there are many more champions of cryptocurrency technology in the House,” some of whom have started trying to rally support for opening the bill up for amendment despite there being delicate margins for defection in either chamber. Those lawmakers “would not be kind of … bound to the compromise that was reached in the Senate,” Brito told PI earlier this week. “So they would have an opportunity to look at this from scratch.”

— He added that until advocates know how the House plans to approach the bill, it would be difficult to mount a grassroots advocacy effort, which he and Smith described as integral to industry efforts to narrow the bill’s language establishing new reporting requirements. For some lawmakers, Smith said, the outcry over the requirements may have been the first time it became clear “that there’s actually a lot of constituents in their home states and in their districts that are participating in the crypto ecosystem and that they care very passionately about it.” The Blockchain Association plans to harness this energy, she said, adding that it’s already opened up a dialogue with a broader group of legislators.

— This month’s scramble to revise the bill was also the result of an industry that has quickly ramped up its presence in Washington over the past year, amid growing criticism by some lawmakers and regulators. While Coin Center has been around since 2014 and the Blockchain Association since 2018, the effort was aided by a much newer crypto trade group that formed just months ago, the Crypto Council for Innovation. “We will work closely with House members to fix the bill so the United States can maintain its role as the global technology leader,” a spokesperson for the group said in a statement. And the cryptocurrency exchange Coinbase, Smith pointed out, didn’t even have offices in Washington until a few months ago but “were wonderful to work with” on the tax provision issue.

— “I think the shortcoming we had going into this is that the crypto advocacy efforts in Washington are … significantly under-resourced,” she said. However, there’s now “a tremendous amount of interest” from companies looking to get involved for the first time or increase their involvement “in order to get … a lobbying infrastructure in place to be more effective.” Brito said that crypto advocates going forward will need to emphasize that the industry is not “averse to regulation,” but “isn’t going to stand” for new rules put together without industry input. Smith said the lobbying fight showed the need for more people working on crypto policy and advocacy in Washington, including potentially holding a “crypto school” for Hill aides and even K Street as more lobbyists get drawn into the policy fights.

Happy Friday and welcome to PI. Send lobbying tips: [email protected]. And be sure to follow me on Twitter: @caitlinoprysko.

IF THERE WAS ANY DOUBT: U.S. Chamber of Commerce chief executive Suzanne Clark did not mince words this morning when asked about Democrats’ multitrillion-dollar reconciliation plans, which have become intricately linked with passage of the bipartisan infrastructure bill and begun to drive a wedge between the party’s centrist and liberal wings. “I think it’s really important that we separate out this really crucial infrastructure bill that does a lot of good work for Americans and America without raising taxes from this $3.5 trillion tax and spending spree that they’re calling reconciliation,” Scott said in an interview on CNBC, differentiating the bipartisan bill that the Chamber fiercely supported from the party-line package Democrats are assembling now.

— Clark echoed concerns that the bill’s price tag could trigger further inflation, calling the bill — which is expected to be funded by a series of tax hikes on corporations and the wealthy, and include a major health care expansion — “a record tax increase on employers and investors” and a “takeover of our health care system.” The Chamber boss pledged to form “the biggest coalition businesses ever put together” to work to defeat the reconciliation bill, which she characterized as a “real threat” to the country’s economic recovery.

RELIEF FOR MOTORCOACHES FINALLY FLOWS: “The Treasury Department has started disbursing the $2 billion allocated for motorcoach, school bus and passenger vessel operators enacted in a December 2020 Covid relief law intended to help the country weather the financial impacts of the pandemic,” industry sources tell POLITICO’s Sam Mintz.

— “Disbursements have been delayed for months as Treasury worked on developing a complicated funding formula, a source of major frustration for its would-be beneficiaries,” which had long lobbied for the funds. “It’s also a relatively small sum of money to help bolster industries which have faced huge losses during the pandemic, losing billions in revenue and hundreds of thousands of jobs.”

— The industry is still operating at only around 50 percent capacity and Peter Pantuso, president of the American Bus Association, “said he’s been getting calls for weeks from members worried about even more financial hits from the rapidly spreading Delta variant,” noting that the roughly 20 percent of lost revenues intercity buses are receiving “‘clearly helps, but more is needed to help build these guys a bridge to get out.’ Pantuso said they’ll take another crack at getting more relief in the budget reconciliation process, despite how long it took for members of Congress to pay attention the first time around.”

BIDEN, PHARMA SQUARE OFF OVER DRUG PRICES: “President Biden stepped up his battle over drug costs on Thursday, calling on Congress to pass legislation that would let Medicare negotiate directly with pharmaceutical manufacturers and penalize drugmakers that increase prices faster than inflation,” The Washington Post’s Cleve R. Wootson Jr. and Amy Goldstein write.

— The push “comes at a delicate time, as drugmakers have earned some of their best headlines in years for the lightning-fast development of coronavirus vaccines.” But the president “had harsh words for the industry. ‘Too many pharmaceutical companies don’t use the profit nearly enough to innovate or on research,’ he said. ‘Too many companies use it to buy back their own stock, inflate their worth, drive up CEO salaries and compensation and find ways to box out the competition.’”

— “In response to Biden’s effort Thursday to focus attention on the issue, PhRMA issued a ‘myth vs. fact’ statement, contending that government-negotiated Medicare drug prices would be accompanied by ‘a harsh reality: reduced access to prescription medicines and choices for patients.’ PhRMA CEO Stephen J. Ubl argued that Biden’s proposals, by wringing money out of Medicare, would only hurt its beneficiaries and vulnerable patients. ‘Many in Congress know that access to medicine is critical for millions of patients and Medicare is not a piggy bank to be raided to fund other, unrelated government programs,’ Ubl said in a statement. ‘This is a misguided approach.’”

MEANWHILE, IN NEW YORK: “Disclosure filings submitted last year — stating that Lt. Gov. Kathy Hochul was lobbied at least twice by a Buffalo firm representing Delaware North Companiescontained incorrect information, the firm maintained on Thursday. Delaware North Companies is the major Buffalo-based food, hospitality and gaming company where Hochul’s husband, William Hochul, has been a high-ranking official since 2016,” The Times Union’s Chris Bragg reports. “Kathy Hochul, scheduled to assume the governorship Aug. 24, is already facing questions about whether her position running the state, and her husband’s job, present a conflict-of-interest.” But lobbying firm O’Donnell and Associates, which represents Delaware North, told the paper that disclosure filings showing O’Donnell and Associates lobbyists contacted Hochul’s office last year were incorrect.

— Elsewhere in Albany, “even after his resignation takes effect in less than two weeks, Gov. Andrew M. Cuomo will still control the largest pot of campaign cash in New York politics, an $18 million war chest amassed in apparent preparation for a run at a fourth term next year.” The New York TimesJ. David Goodman breaks down what Cuomo can do with all that cash.

Jack Norris has been named state and local government affairs director at Ingalls Shipbuilding. He previously led program management activities for Covington Civil and Environmental and was an aide to former Senate Majority Leader Trent Lott.

Hannah Packman is joining the Nature Conservancy to support the group’s Shellfish Growers Climate Coalition. Packman was communications director for the National Farmers Union.

Ken Cuccinelli is now senior fellow for immigration and homeland security at the Center for Renewing America, the think tank run by former Trump OMB Director Russ Vought. He previously was deputy DHS secretary.

Richard Hartnett is now manager of strategic communications at the Chamber of Commerce. He previously was a legislative aide for Sen. Chuck Grassley (R-Iowa).

Catherine Gabel is now partner manager for government, politics and nonprofits at Facebook. She previously was a principal at Precision Strategies and is an alum of Sen. Cory Booker’s (D-N.J.) office.

Musa al-Gharbi is now a senior fellow at the Niskanen Center. He currently is a Paul F. Lazarsfeld fellow in sociology at Columbia University.

Majority 2022 (Rep. Val Demings, Sen. Richard Blumenthal, Sen. Maggie Hassan)

CRYPTO PAC (Super PAC)
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Pilar Faulkner: Burrell College Of Osteopathic Medicine
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Fdj Solutions LLC: Exile Concepts LLC
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CORRECTION: An earlier version of Influence misstated the name of U.S. Chamber of Commerce Suzanne Clark.

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