The Digital Asset PARITY Act

The News Summary

In late December 2025, Representatives Max Miller (R-OH) and Steven Horsford (D-NV) introduced a bipartisan discussion draft of the Digital Asset PARITY Act. The bill—formally the Digital Asset Protection, Accountability, Regulation, Innovation, Taxation, and Yields Act—aims to modernize the federal tax code by treating digital assets with the same "common-sense" principles applied to traditional securities and commodities. By addressing "phantom income" and unnecessary reporting for small transactions, the Act removes the administrative barriers that have long stifled the utility of digital assets.

Key Provisions & Market Impact

The Act introduces four high-impact changes designed to foster institutional adoption and retail utility:

• The $200 Stablecoin Safe Harbor: Establishes a de minimis exemption for capital gains on purchases under $200 using regulated, dollar-pegged stablecoins. This removes the burden of tracking cost basis for everyday commerce, effectively positioning stablecoins as a viable competitor to traditional payment rails.

• Staking and Mining Deferral: Offers a landmark "middle path" for staking and mining rewards. Taxpayers can elect to defer taxes on rewards for up to five years, at which point they are taxed as ordinary income at fair market value—solving the liquidity crisis created by "phantom income."

• Securities-Lending Parity: Extends existing tax rules for securities lending to digital assets. This ensures that bona fide lending or collateralization is not treated as a taxable sale, unlocking massive capital efficiency for institutional treasuries.

• Normalization of Anti-Abuse Rules: Formally applies wash-sale and constructive-sale rules to digital assets. While this ends certain tax-loss harvesting strategies, it provides the regulatory "normalization" that institutional compliance departments require to manage digital portfolios with traditional rigors.

The BitGo Tie-In: Engineering Compliance for a New Era

As the tax code for digital assets becomes increasingly sophisticated, the need for institutional-grade infrastructure is no longer optional. BitGo provides a bridge between these new laws and operational reality.

• Precision Data for Wash Sales: The introduction of wash-sale rules requires near-perfect data accuracy across wallets and exchanges. BitGo’s institutional qualified custody and sub-ledgering tools provide the real-time cost-basis tracking and audit trails necessary to meet these new standards without increasing operational overhead.

• Unlocking Lending with Tax Certainty: With digital asset lending now recognized as tax-neutral under the Act, BitGo’s treasury management solutions allow firms to use their Bitcoin or stablecoins as collateral with total fiscal clarity, backed by our regulated, bankruptcy-remote qualified custody.

• National Bank Security: As the industry moves toward "Tax Code 2.0," BitGo’s position as a national bank charter holder ensures that your digital treasury is handled with the same legal and fiscal security as a traditional cash account, fulfilling the "parity" promised by the new legislation.

Core Sources & References

• Official Press Release (Max Miller): Congressman Miller Releases Bipartisan Legislation to Modernize Tax Treatment of Digital Assets.

• Official Press Release (Steven Horsford): Reps. Horsford and Miller Unveil Discussion Draft to Bring Tax Clarity to Digital.

• The Block: Bipartisan House lawmakers unveil crypto tax framework with stablecoin safe harbor.

• Blockchain Council: US Lawmakers Propose Tax Break for Small Stablecoin Payments.

• Coindesk: US bipartisan lawmakers draw up tax bill with stablecoin and staking relief.