The CLARITY Act Just Killed Bitcoin’s Future

Hello everybody. Welcome to the Saturday live stream.

This Clarity Act, this bill is careening out of control and it's not so much it's not about the yield anymore. Now it's about double taxation and de minimis. This is what I'm talking about.

There was a post, this is by TFTC, great one to follow. I'll try to link this in the description where they just talk mostly about Bitcoin and it's about this Clarity Act which everybody has been so fanatical about, even myself. I'm, you know, would really like to get this passed and really like to go forward, but it looks like it is careening out of control.

Here's what we got and this whole post pretty much alludes to the fact that Brian Armstrong from Coinbase is sabotaging it. I don't necessarily want to say 100% I believe in that. I don't think there is enough evidence to say that. But the things that are talked about in here are damning.

Here's what we got. Coinbase was quietly lobbying to kill a real de minimis tax exemption. First of all, what is a de minimis tax? The de minimis tax is essentially it is so minimal to report these types of tax transactions that it makes it unfathomable and not useful for any type of tax central agency like the IRS here in the United States. So for a de minimis, what people were saying is like, "Hey, for Bitcoin, let's just give it to a certain point, like $600, and if you just, you know, $600 or below, you don't have to say anything because it's it's de minimis." Now it looks like they're going to get away, just pretty much push that away, and we'll get into why that is awful, but it's actually just really essentially a sugar stick for nonsense anyhow.

Well, Bitcoin were pushing one that applied only to stablecoins. So, they're going to give a de minimis tax to stablecoins, which makes no sense to me anyhow because a stablecoin is essentially pegged to the value of the dollar, that value to a treasury, the value to $1.00 or a dollar. So, why do we even need anything with the de minimis for a stablecoin? I understand why Coinbase would be lobbying for that because apparently they made $1.35 billion in stablecoin revenue last year. That's fine. This is a free market. If Coinbase is making a bowl of money, congratulations. That's great. And that's up 48% year-over-year, almost entirely from yield on the treasuries backing USDC.

Here's the problem. Latest drafts from representatives Horsford and Miller are stating that the act framework has dropped. It gives a de minimis exemption to stablecoins, which makes sense because, I mean, you know, that's the easy thing, right? "Oh, we'll give you de minimis of stablecoins. Okay, it's for a dollar, but who cares?" But leaves Bitcoin out entirely. This means that in the white paper from Satoshi Nakamoto, it states Bitcoin should be a medium of exchange. It should be used for transactional purposes. It's very hard to use it for transactional purposes if you have to record every single transaction you do. Like, "Hey, I bought a bubble gum today. I bought some coffee. I paid the gardener. I did all these different things and now it's it's above this, so I have to pay some kind of capital gains tax." Ridiculous.

That's not the worst part. It also keeps the punishing double taxation on Bitcoin mining fully intact while carving out relief for passive validation like staking. So essentially, it's already a tough go for the miners. We just saw that Marathon's CEO, Fred Thiel, came out and said, "Look, we're going to sell roughly $1.1 billion dollars worth of Bitcoin and we're going to pivot over to AI data centers and pretty much work along with AI because it's very expensive to do Bitcoin mining right now." Which is fine. Again, free market. So, if you're going to double tax them for the time that when they actually produce Bitcoin and then when they actually sell Bitcoin for the capital gains of that, that's a very difficult problem.

So, where are we going here? Well, it's not looking too good. I'm sorry for being so bearish, but there is a resolution. And this one makes sense to me. And this was from Eric Beller. Definitely a good one to follow. Link him in the description. Civ good governance, land value tax, HSAs for all, regenerative agriculture. You got to love that. And he said, "Hey, this de minimis thing is solvable." And he says this, there are only two worthy solutions worth discussing. And when I read this, I'm like, "This makes a lot of sense."

Foreign currency treatment, or we should treat Bitcoin as just a currency. Like that's how it is. That's what it's supposed to be. Bitcoin gets the same rules as euros. IRS has to prove you gained above the threshold. Burden flips to the government. I like that one. But the second one I like even better. True exclusion for Bitcoin. Use a medium of exchange. That's what it's supposed to be. Not a deduction, not an exemption, a complete carve-out. Cash doesn't generate a tax event. Neither should Bitcoin.

Now, when you read this, I want to read it to you, you're like, "Bro, that's a very nice pie in the sky type of thing, but it's never going to happen." It's not going to happen because they're not going to allow that to happen in Bitcoin. And you know what? You're probably right. But it is a good thought exercise.

But I thought about this more and more after I was sent this clip. This was Mark Moss versus Peter Schiff and yet another debate with Peter Schiff. Do we have to keep debating Peter Schiff? Do we know his stance? Do we know our stance? Why do we keep doing this? Uh, I didn't watch this. I mean, I'm sure it's got great content, but I'm just not going to watch it. But the snippet that was sent to me was what Peter Schiff said, which he was right. And he said, you know, Bitcoin is a great medium of exchange, and it can be. Well, he didn't really say it's a great medium of exchange, but he says gold is a medium of exchange. And now that we're going to tokenize gold, it's going to take away the thunder from Bitcoin as a medium of exchange. And I thought about that. I'm not going to play because it's it's classic Peter. It's fine. He's got his stake. I actually like Peter. But when he says about that and he says, "Yeah, you can just use we can just tokenize gold." You still got a problem with de minimis tax. And he knows that.

And if we take a look, well, first of all, would this make it beat Bitcoin? No. Bitcoin is still not scarce. It's finite. So, it beats gold in that regard. Gold is scarce. If you want to have more gold, it's very easy. You can find it in asteroids or you can just start mining more of it. And especially when we start to get AI and some autonomous robots, they're going to be able to dig for that stuff 24/7, 365. So, it's not even going to be that much of a difference. However, where Bitcoin does beat gold is the time stance. It's been around for since the beginning of the planet and it's been used for a lot longer for medium exchange. And on that one, Bitcoin will never beat gold. It can't go back in time and it is more volatile. Of course, that is some say that's actually a strength. But what Peter here says about it being like a tokenized asset as a reminder, guess what? Gold is still going to be taxed. You still have capital gains. So, it's you got the same problem that Bitcoin's going through.

However, however, why don't we just do what El Salvador did? Make Bitcoin legal tender. El Salvador, I swear, is one of the blueprints for how things should go. El Salvador has it. Bitcoin is legal tender, which means there's no capital gains tax on Bitcoin exchange appreciation. And I'm sure Peter would like this. Uh, in Germany, if you hold crypto for more than one year, the gains are tax-free for individuals. I'm just kidding. He's not going to like that. And then Singapore and United Arab Emirates, these countries generally do not impose capital gains tax on individuals for most assets. That would also include crypto, including crypto and foreign exchange. Now, there is something I don't know why I didn't put it in here, but in the UK, if you have a gold token that they say would be considered as a type of currency and there is no capital gains. So, just like we have one place, El Salvador, where it's legal tender, gold has one place where you can actually use it and not have capital gains tax. That I think is the resolution.

And the only way that we can get that done is by getting by getting this guy to push it through. Listen to what he says here. I know some people hate Trump or love Trump. It doesn't matter. Just listen to this for 17 seconds. >> And Bitcoin superpower of the world. Bitcoin's very powerful. It's all becoming powerful. So many people now they want to pay you in crypto. They want to pay you in Bitcoin. And we we have to be at the top of it in all of these call it an industry. >> It is an industry. And here's the thing. That guy ran as being the Bitcoin president. He hasn't done squat. Him and David Sachs, the cryptozar and AIzar and things like that. They haven't done anything. The only thing that they've done so far is given us a pump and dump Trump and a pump and dump Melaniacoin. That's it. I got to tell you, Peter or Sachs, David Sachs, and his reign as the cryptozar was a disaster. I don't think they've done anything. This Clarity Act is going way too long. Yes, they did pass the Genius Act. I'll give it to them, but come on. Can we get some other things done?

And the only way again for this de minimis tax to go away or let's just say let's just call it what it is, fiat currencies. Anyhow, let me know what you think about that in the comments section.

And lastly, before we get into a little Q&A, uh, more dumbness. Bloomberg comes out and says that Kali has secured a license allowing it to offer margin trading to users. If you don't know what Kali is, it's kind of like Polymarket, predictive markets. And they said that they're going to offer margin trading to users, a feature that would make the prediction market platform more appealing to sophisticated institutional investors. Sophisticated institutional investors. That's another word for inside investors. If you don't believe me, I just did a video yesterday about this and I'm trying to do these like shorter videos, like 3 to 5 minutes, 3 to 6 minutes, and I explain to you how Polymarket is a cesspool and an abomination in the crypto markets and it should go away. And the reason why I talk about that is because roughly 80% of you are losers and only 20% are winners. And that's up to like roughly $1,000. But the only ones that are winning are the inside traders. And that's 0.04% that are the massive gains of $3.7 billion. So when I hear stuff like this, it infuriates me because they are essentially leading retail down that road to just getting broke. Anyhow, let me know what you think about that in the comments section. Sorry.

And again, uh, I didn't link this in the description, but you can just search it for digital asset news and Polymarket. The first one to come up. If all this tax talk and de minimis talk is something that you are thinking about, don't forget that's do what I do. Do a Roth IRA with iTrust and right now you get $100 funding reward for your retirement accounts. Just remember that until April 15th, you can fund it from 2025 and 2026. And after April 15th, then you got to only fund 2026, which is you only get one a certain amount to fund your retirement account, which means no capital gains tax. You can take that out 59 and a half years old. Oh, and also guess what? For staking, there's no fees for that either.

Anyhow, that's it for today. So, look, if you like today's video, I know it wasn't the most cheery. Give it a thumbs up and subscribe. But that's it for today. If you want to stick around, we'll do a little Q&A, answer all your questions, and we'll get out of here. And Jetack is 100% correct. Don't buy the FUD. Don't, well, don't listen to the FUD. I don't know if you can buy the FUD. Don't buy the FUD. Buy Bitcoin. Yeah. Um, I'm buying that every week on Monday. Seems to kind of work out. Uh, I think I'll be rewarded in probably a year or two years, but I don't think I'm going to be rewarded anytime soon. I think we're going to actually keep going down and from there.

Oh, and there's one more thing I want to mention about this. As if I couldn't get more negative. This Clarity Act, I don't see how we're going to be able to pass this. Um, especially with this being the midterm year and Trump and the Republicans pushing crypto agendas and the Democrats pretty much going against crypto agendas. So I just was looking at this and I'm like, why would why would the Democrats give Trump a win? You know, they probably, I mean, if you don't, they're stubborn. Look what's going with the TSA. So like when I see clarity and people are like, "It's going to do the greatest thing of all time." First, it has to get passed. And second of all, if it gets passed in the way that it's shaped up right now, expecting not to do much. Sorry.

Ah, David's here. Rob, you should have had him on the show sometime. We can go over my portfolio. We can laugh. You know, it sucks right now, but I mean, look and and think. I really want you guys to think about this. Where else can you get these types of gains over time? I know people are like, "What do you what do these gains you talk about? We've never seen these." Yes, you have. Look, if you got in at the top, I get it. Trust me, I got in at the top in 2017, 2018. I thought I was a Some days I still have. But as time goes on, I'm like, "Oh, this is all you got to do. You just got to wait it out, sit around, dollar cost average, buy when things are low, and then sell when things get a little bit higher." Got it. So, I know people say, "Well, retail's gone. They're not coming back." They'll come back. Where else do you get these types of gains? You don't get in the S&P 500. As actually, matter of fact, I just saw a report. Look at this. The S&P 500, this is its worst, its worst month since 2022. And I think it's actually hitting for one of its worst years. So, I know people will say, "Well, they'll they'll invest in traditional." No, they won't. There's not that many gains for there. And which ones are I to I look at this and go, which markets are heavily undervalued? Is it the S&P 500 and all the AI top-heavy businesses that are that make up the S&P 500, or is it gold and silver which just had a massive run, or is it oil which is going up like crazy? People probably shorted that. Or is it maybe like Bitcoin that's dropped over, well, now roughly 43%, or altcoins that are actually do stuff and have utility best? Which ones are undervalued? Which ones can actually get some gains? I just think that as time goes on, everybody was so enthralled in the dot era and they couldn't get their hands on enough of it. And then when it died, which it did because we didn't need so many.coms, we didn't need so many websites and we didn't need like Lipton Iced Tea going. Now we're Lipton.com and invest into our company because now we're all about the .com era. People are going to retail is going to get crushed and then they're going to look around and go, "What should I get into? There is that Bitcoin thing." So we'll see. Maybe I'm just a little a hopeless romantic for the people that would actually get back into crypto. Who knows?

Babe, it's good to see you. Uh, let's see. Debsky, hope you heal your back, Rob. Yoga has really helped for me. Yoga is great. I did acupuncture, cupping, and drinking actually helps quite a bit with the pain. So, let's see here. Rob got 128k camera. Very true. Let's see. Clickbait. Eh, let's see. Well, actually, let's see. Let's go back to it. The Clarity Act just killed Bitcoin's future. Yeah, I think it did. I mean, look, man. If you've got double taxation for Bitcoin miners, and you're not going to pass the de minimis tax, which means that you can't use Bitcoin for what it was originally created for, for peer-to-peer transactions, what the hell do you want? I think that this Clarity Act is going to be an abomination moving forward. So, no, I don't think it's clickbait. Anyhow, and look, my job is to create interest. If you didn't have a good time, then give me a thumbs down and get the f out of here. I don't care.

Rob, at what risk levels increase your DCA? Uh, it just goes down. Let's take a look here. There it is. Let's see. Um, so usually what everything starts at around 0.5. That's what I want to start dollar cost averaging. But as the price goes down, which means there's less risk because it's going down, which is crazy to think about, but that's how you should think about. Then you start to double up at around 0.4. Then you start to double up at around 0.3 and below. And then 0.2, you quadruple, and so on and so forth. So I start around 0.5. People think I'm say no no no no no Rob you should start at 0.4 or actually people say no no no Rob you shouldn't even do that. What you should do is just go to these moving averages and just wait for the 200 EMA moving average and then go all in heavy. I'm like, well, you know, I appreciate the indicators, but I will like to direct your attention to all of these awesome indicators called the bull market peak indicators, sell at the top. How many of these actually went off? Well, let's go through them. The Bitcoin index, not even close. PI cycle top, no multiple halfway there. Bitcoin rainbow chart, 40% there. Let me just give it to you. None of them hit. So indicators are fantastic until they're not. So moving averages, I mean, yeah, cool. I mean, the 200 moving average is at $59,000. We hit that. So maybe that was the bottom. Some people say 50 is the bottom. Some people say it's 37. And some people say $2 at the bottom. I'm just kidding. Nobody says that. But if they did, they sound reasonable because, you know, people are crazy bearish. Uh, so I just go like this. I'm like, well, if we get below the 200 weekly average and we hit like the 250 week, I would probably want to buy more. See, this was my mistake last cycle, and I'm going to rectify that this one in 2022 when things started going down. I was DCAing for a bit, but then I just got scared. I'm like, maybe it's going to keep going down. Maybe I'll just wait like everybody says. And I did this thing called micro DCAing. Stupid. And uh, I should have bought a lot more. Now, I did. I did just fine. Don't worry about me. I'll be okay. But these days, I'm just going to keep buying as it goes down and uh increase my buys as it continues to go down. And that's it. Even if we had a recession. Yep, that's it.

Rob, can you check your streaming settings? Look, if it's glitchy, I can't do anything about it. I know that the camera's not the greatest for some reason. I don't know why that is. I think it's it might be my computer. It might be the internet service, which is crazy because in Puerto Rico it's better over there. I don't know. Don't worry, you can hear me. That's what counts. Yeah. Yeah. He says, "Drinking helps with pain." That's true. I am a, I'm a refined drinker though. Only the best like Lone Star or Modelo for me. Probably so sophisticated and people getting salty. Yeah, I get salty too. It's in human nature. But I'm more salty because my back is in continuous pain. So, that's that's me. I mean, it's better when I'm standing up. I'll say that.

Benny says, "You have a nice pool indoors. You see me doing okay." Just a green screen. I fooled everybody. And we say this, your internet. Maybe the router needs. Well, here's the question then. If it is the internet, check this out. How good does this image look to you guys right now? Can you see all the words? Are they fuzzy like my face? And that's it. One star is good stuff. Clarity Act is awesome. Yeah. Well, if that's the case, if Clarity Act is awesome, I I think that is hyperbole. Let's see. And then if people are saying, "Yeah, it looks clear." So, it's not my internet connection because if you can see that screen and you can see this screen and if you can see this orange guy and he looks not pixelated like I do, then it's not that. It has to be something with my camera. Yeah. So, it's a potato camera.

Well, that's it for today, everybody. But thank you for troubleshooting me. I appreciate it. That was awesome. So, everybody, that's it for today. If you like today's video, thumbs up, subscribe, all that great stuff. Tomorrow we'll have Jerry on and he will bring some some levity to the situation and maybe make me not so damn bearish and we'll go from there. Anyhow, thanks everybody for stopping by. I appreciate you. Go enjoy your Saturday. Nothing else going on. Thanks so much. See you in the next one. Adios.