Coinbase Urges Congress to Scrap Capital Gains Taxes on Bitcoin, XRP, Others

Crypto expert John Squire, known on X as @TheCryptoSquire, has spotlighted a significant policy appeal made by Coinbase during a recent congressional session.

In his post, Squire wrote, “COINBASE CALLS ON CONGRESS TO SCRAP CAPITAL GAINS TAXES ON #XRP FOR DAILY PAYMENTS,” adding, “XRP AS MONEY IS A REALITY IN THE MAKING.” His message referenced a video clip showing a Coinbase executive addressing lawmakers about the potential consequences of current tax rules for digital assets such as Bitcoin and XRP.

Squire’s post centers on Coinbase’s argument that applying capital gains taxes to routine crypto transactions may discourage everyday use. The exchange is urging Congress to consider removing capital gains obligations on small, daily transactions involving digital assets.

According to the implication in Squire’s message, such a change could help establish cryptocurrencies, including XRP, as practical payment tools rather than assets used primarily for investment.

Lawrence Zlatkin Warns of Over-Reporting Risks

The video attached to Squire’s post features Lawrence Zlatkin, Vice President of Tax at Coinbase, responding to questions from a U.S. senator.

When asked whether specific legislative provisions could cause harm, Zlatkin pointed to what he described as the risk of excessive reporting requirements. He stated that there is “a lot of potential for over-reporting,” especially in discussions concerning de minimis exemptions and stablecoins.

Zlatkin explained that digital assets represent a democratized financial asset class, enabling individuals to transact in new ways. However, he cautioned that without a de minimis rule to exclude small transactions, taxpayers could face the burden of tracking and reporting billions of transactions. He said this outcome would not only affect taxpayers but also place a strain on the Internal Revenue Service.

According to Zlatkin, many individuals are not prepared to manage the reporting obligations that would arise if every small crypto payment triggered a taxable event. He warned that increasing compliance demands without sensible exemptions could slow the industry’s development. In his view, both taxpayers and regulators could be overwhelmed if legislation does not account for the practical realities of high transaction volumes in digital asset ecosystems.

Another speaker during the hearing emphasized the importance of keeping reporting requirements simple, while acknowledging the technological complexity underlying blockchain systems. The discussion also included participation from a representative of the American Institute of Certified Public Accountants, reflecting concern within the tax profession about how digital asset regulations may evolve.

Implications for XRP and Everyday Crypto Use

By highlighting Coinbase’s congressional remarks, John Squire underscored what he sees as a turning point for XRP and other cryptocurrencies. His statement that “XRP as money is a reality in the making” reflects the belief that tax reform could accelerate the adoption of digital assets for daily payments.

If lawmakers decide to modify capital gains treatment for small crypto transactions, assets like XRP could become more viable for routine purchases without creating complex tax obligations for users.

The legislative outcome will play a decisive role in determining whether digital assets in the United States can function smoothly as everyday payment options while maintaining manageable compliance standards.

Disclaimer: This content is meant to inform and should not be considered financial advice. The views expressed in this article may include the author’s personal opinions and do not represent Times Tabloid’s opinion. Readers are advised to conduct thorough research before making any investment decisions. Any action taken by the reader is strictly at their own risk. Times Tabloid is not responsible for any financial losses.

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