Congress Advances Stablecoin Tax Parity: How New Rules Could Make Digital Dollars Feel Like Cash

Washington is not attempting to resolve every cryptocurrency policy debate simultaneously. Instead, it is prioritizing a clear regulatory path for one specific type of digital asset: regulated, dollar-pegged stablecoins. The GENIUS Act established the first federal regulatory framework for payment stablecoins, and a bipartisan House tax discussion draft now seeks to provide more favorable tax treatment for these tokens when used by individuals and businesses.

Together, these efforts signal a deliberate focus on stablecoins within U.S. crypto policy, potentially transforming how users, merchants, and issuers engage with digital dollars in the coming years.

What the Digital Asset PARITY Act Proposes

The Digital Asset PARITY Act is a bipartisan discussion draft introduced by Representatives Max Miller (R-Ohio) and Steven Horsford (D-Nevada), both members of the House Ways and Means Committee. The initial version was released in December 2025, with a revised draft published on March 26, 2026, featuring significant updates to its core stablecoin provisions.

Under the revised March 2026 draft, gains from selling a “regulated payment stablecoin” would generally not be included in gross income, and losses would not be recognized—unless the taxpayer’s basis in the token falls below 99% of its redemption value. For exchanges, the recipient would receive a deemed basis of $1.

To qualify for these tax benefits, a stablecoin must meet the following criteria:

• Issued by a permitted payment stablecoin issuer under the GENIUS Act;
• Pegged exclusively to the U.S. dollar;
• Demonstrate tight price stability over the prior 12 months.

Brokers and dealers are explicitly excluded from these provisions.

For everyday users, this means spending a qualifying dollar stablecoin would no longer trigger a minor but recurring tax event each time the token’s value fluctuates by a fraction of a cent. The draft aims to grant stable, regulated dollar tokens the same practical flexibility as cash, rather than subjecting every micro-fluctuation to the capital gains rules applied to volatile crypto assets. This is a narrowly tailored exemption for tokens designed and regulated to function as digital representations of the dollar.

Why the GENIUS Act Is the Regulatory Backbone

The Digital Asset PARITY Act cannot be viewed in isolation, as its scope is directly tied to the regulated stablecoin category established by the GENIUS Act. That law, which passed the Senate 68-30 and the House 308-122 with strong bipartisan support, defines who can issue payment stablecoins in the U.S., the reserves they must hold, and the compliance obligations they must meet.

The GENIUS Act requires:

• 100% reserve backing with liquid assets;
• Compliance with Bank Secrecy Act obligations;
• Implementation of anti-money-laundering (AML) and sanctions compliance programs.

The regulatory infrastructure supporting this framework is already advancing. In early March 2026, the OCC proposed implementing rules covering standards for reserves, capital, liquidity, and risk management. In April 2026, the Treasury Department and FinCEN/OFAC jointly issued a proposed rule establishing AML and sanctions compliance requirements for permitted payment stablecoin issuers. Additionally, the FDIC has begun outlining application procedures for FDIC-supervised institutions seeking to issue payment stablecoins through subsidiaries.

The tax draft’s explanatory notes acknowledge that its provisions are designed to complement the GENIUS Act’s regulatory structure, ensuring that stablecoins operating within its framework receive appropriate tax treatment.