Clarity Act Requires Crypto Tax Changes for Wider Use

U.S. crypto industry. Robin Singh wrote that the legislation alone will not increase adoption without changes to tax reporting requirements. Form 1099-DA requires crypto brokers to report the number of assets, acquisition dates, sale dates, and aggregated data for stablecoins and NFTs.

Singh stated that many forms list proceeds without reliable cost basis information and omit non-custodial activity.

Retail investors must reconcile thousands of transactions across exchanges, wallets, bridges, and DeFi protocols. When assets move between platforms, cost basis data often disappears and receiving firms cannot reconstruct purchase history. The Clarity Act mandates audit trails to prove segregation of customer assets.

Singh noted that these requirements add operational costs, especially for small and mid-sized firms just above the de minimis threshold.

U.S. policy supports market growth while applying reporting rules designed for traditional brokerage accounts. He stated that other jurisdictions, including those following the OECD Crypto-Asset Reporting Framework, collect standardized data without requiring perfect cost basis reconstruction.

Discussions of de minimis exemptions and targeted relief for small transactions have begun. Singh concluded that without broader tax framework adjustments, mainstream retail participation may remain limited.