A new fight is happening over Bitcoin tax rules in the US. Coinbase CEO Brian Armstrong and Block CE

Bitcoin vs. Stablecoins: D.C. Tax Fight Heats Up as Armstrong and Dorsey Weigh In

A quiet tax debate in Congress just got loud. A proposed exemption for small crypto transactions—once expected to cover Bitcoin—is now being narrowed to stablecoins only. Bitcoin backers are furious, and the industry's biggest names are now in the ring.

Marty Bent, a Bitcoin advocate and Ten31 partner, lit the fuse. He claims lobbyists are telling lawmakers that "no one uses Bitcoin for everyday payments," so tax breaks should go to stablecoins instead. His sources? "Informed," he says.

Coinbase pushed back fast. Chief Policy Officer Faryar Shirzad said the company has always backed exemptions for all digital assets and has never lobbied against Bitcoin. Brian Armstrong himself denied the claims publicly.

Then Jack Dorsey chimed in. The Block CEO posted on social media, publicly asking Armstrong to ensure the rules cover small everyday Bitcoin transactions. The exchange put the debate front and center.

At the heart of it: U.S. tax law treats crypto as property. Buy coffee with Bitcoin? That's a taxable event. Reporting requirements make real-world crypto payments a compliance nightmare. A "small transaction exemption" would change that—but only if it applies to Bitcoin, not just stablecoins.

The Bitcoin Policy Institute says some lawmakers have shifted, now favoring minimal exemptions for stablecoins only. The latest Parity Act draft explicitly names "regulated payment stablecoins"—Bitcoin is out.

Multiple proposals are on the table: small payment breaks, stablecoin exemptions, Gas fee relief. Different assets, different interests. The fight is just getting started.