We are the chief executives and senior representatives of leading American companies in the Bitcoin mining and digital infrastructure industry, collectively representing over 50% of the United States’ Bitcoin mining capacity through our membership in the Digital Power Network (DPN). As industry leaders and DPN members, we write to request an urgent update to the federal tax treatment of Bitcoin mining rewards. As you are aware, Bitcoin is widely recognized by U.S. regulators and courts as a commodity asset, not a stock or a currency, and it should be taxed in line with other commodities. Every relevant financial regulator has affirmed Bitcoin’s status as a commodity: for example, the Commodity Futures Trading Commission (CFTC) has explicitly determined that Bitcoin and other virtual currencies fall under the definition of a “commodity”, and the Securities and Exchange Commission (SEC) has likewise confirmed that Bitcoin is a commodity rather than a security. Federal courts have concurred, holding that virtual currencies like Bitcoin are commodities under existing law. Yet, the Internal Revenue Service’s current tax policy, still based on guidance issued in 2014, is misaligned with this classification, resulting in an unfair double taxation of Bitcoin miners. We respectfully request that the Treasury Department and IRS correct this discrepancy by issuing updated guidance so that mined Bitcoin is taxed only upon sale, just as other commodities such as oil, wheat, or corn are taxed.

In conclusion, aligning the taxation of Bitcoin mining rewards with the established taxation of other commodities is a sound and fair policy choice. Bitcoin’s status as a commodity has been affirmed by the SEC, CFTC, and federal courts, and it should be afforded the same tax principles that apply to commodities like oil, gold, wheat, or corn. Under those principles, tax is assessed when income is realized (at the point of sale), not at the point of creation. The current policy of taxing block rewards at creation (per Notice 2014-21) is an outlier that warrants immediate correction. We respectfully ask that the Treasury Department and the IRS update their guidance to recognize mined Bitcoin as newly created property that is not taxable until it is disposed of (sold or exchanged). This change would eliminate the existing unjust double taxation, create parity between digital asset producers and traditional commodity producers, and remove a deterrent to growth and innovation in the blockchain sector.