Weekly Crypto Regulation Roundup: Staking Taxes, Federal Reserve Payment Account Model, and SEC Fraud Charges
Eighteen bipartisan House lawmakers, led by Representative Mike Carey, have urged the IRS to revisit the tax treatment of staking rewards. They seek a review before 2026, arguing that current rules cause double taxation, as staking rewards are taxed both as income upon receipt and again upon sale. Lawmakers debate whether staking should be treated as earned income or as unrealized asset appreciation.
Meanwhile, the Federal Reserve has opened a public consultation on a proposed 'payment account' designed to give crypto and payments firms limited access to U.S. payment rails without requiring full master accounts. This initiative, announced alongside a 45-day comment period following publication in the Federal Register, aims to accommodate new business models while preserving regulatory safeguards. It signals that regulators are working to integrate digital assets into the broader financial framework.
In enforcement actions, the Securities and Exchange Commission (SEC) charged fake crypto trading platforms and AI-branded investment clubs involved in a $14 million retail investor fraud. The entities charged include Morocoin Tech Corp. and Berge Blockchain Technology Co. Ltd., highlighting ongoing efforts to protect consumers from fraudulent schemes.
At the state level, Arizona lawmakers have proposed bills to exempt virtual currency from state taxes and to bar local governments from taxing blockchain node operators. The proposals include a constitutional amendment to exclude crypto from property tax, pending voter approval in November 2026. Currently, Arizona levies a 2.5% income tax on virtual currency.
