Sen. Steve Daines unveiled the ADAPT Act on Sept. 30, proposing tax relief for qualifying stablecoin purchases and small blockchain fees while extending investment anti-abuse rules to digital assets.
The bill text published by his office would let eligible users spend regulated dollar stablecoins on goods and services without recognizing a gain or loss. It would also provide relief for digital assets used to pay transaction costs totaling $10 or less. Today, paying those costs in crypto is itself a disposal that can require a separate gain-or-loss calculation.
For investors, the trade-off is tighter limits on selling tokens at a loss and immediately buying them back for a tax deduction. The proposal would extend wash-sale rules to traded digital assets and constructive-sale rules to crypto positions whose gains are locked in through offsetting trades. It is proposed legislation, not a change to taxes currently owed.
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Daines’ section-by-section summary lists three Republican cosponsors: Sens. Tim Scott, Cynthia Lummis and Bernie Moreno. Its full name is the Aligning Digital Assets with Principles of Taxation Act.
Daines described the approach as “extending familiar tax rules like wash sales and constructive sales to digital assets” in his announcement.
Payment Relief Comes With Conditions
The stablecoin provision covers purchases of products and services, not investment sales or exchanges. Eligible tokens must come from issuers permitted under the GENIUS Act and appear on a Treasury list of stablecoins that traded within 3% of $1 over the preceding 12 months. The taxpayer must also have acquired the token within that price band. Stablecoin traders, brokers and dealers are excluded.
The $10 transaction-cost exception covers network and gas fees, priority fees and tips, as well as commissions and transfer taxes. Costs belonging to the same economic transaction would be added together. The relief would still require adjusting transaction costs used to calculate gains, deductions or an acquired asset’s tax basis for the gain or loss left unrecognized. The benefit excludes professional traders, brokers and dealers, businesses facilitating validation for others, and people who initiated more than 5,000 digital asset transactions in the preceding tax year.
The proposed wash-sale expansion would generally deny a loss deduction when an investor buys substantially identical assets within 30 days before or after a sale. Economically equivalent tokenized and bridged assets would count, limiting the ability to maintain the same exposure through another token. Qualified dollar stablecoins and acquisitions through staking or mining are among the exceptions; the text also protects digital assets acquired before enactment.
The constructive-sale provision would extend rules that recognize gains when investors effectively cash out through offsetting positions without selling their appreciated holdings. Qualified dollar stablecoins are excluded, and transactions entered into on or before enactment would be protected.
Staking and Lending Get Targeted Changes
For lending, the bill would extend securities-lending treatment to qualifying loans of traded digital assets, so transferring the asset under an eligible loan agreement would not itself trigger a taxable disposal. That protection concerns the loaned asset, rather than a blanket exemption for the income it generates.
The staking provisions focus on where income is sourced and how investment vehicles are taxed. Validation income would generally be U.S.-source for U.S. persons and foreign-source for foreign persons, subject to branch rules. Qualifying exchange-traded trusts could stake without losing their investment-trust tax treatment, while tax-exempt organizations could exclude qualifying passive validation income from unrelated business taxable income. Debt-financed property rules would still apply.
The sourcing provision expressly leaves the timing of reward taxation unresolved. Under the IRS’s existing staking ruling, cash-method taxpayers include rewards at fair market value when they gain control over them—not when they eventually sell.
The Senate proposal follows a separate bipartisan House effort. The Ways and Means Committee approved the Digital Asset Tax Certainty Act, H.R. 10357, by 38-5 on Sept. 16. That bill also addresses payment costs, lending, staking and wash-sale rules. Committee approval was not passage by the full House.
Both tax efforts are separate from the market-structure CLARITY Act, which failed a Senate procedural vote 49-50 on Sept. 15. Under Daines’ proposed timetable, stablecoin-payment and small-fee relief would apply to transactions after Dec. 31, 2026; the lending and anti-abuse changes would generally apply prospectively after enactment.