August Special Edition: Digital Asset Tax 

This week, I’m breaking from our regular comprehensive roundup of federal and congressional developments to share two papers I prepared on digital asset tax policy. As the regulatory landscape for digital assets evolves, understanding tax implications is more important than ever. (Highlights from the week in digital assets federal policy are below, too!)

The first paper offers an analysis of the President’s Working Group on Digital Asset Markets recommendations on digital asset taxation. This paper is the first in a series, providing an accessible analysis of each section of the PWG’s comprehensive 180-day report. 

The second paper serves as a primer on current law and major legislative proposals shaping the future of digital assets taxation.

I invite you to dive into these timely analyses, and please reach out with any questions.

As usual, below are highlights from the week in digital assets federal policy. The July 30 release of the PWG report, Strengthening American Leadership in Digital Financial Technology, sparked notable events, including SEC Chair Paul Atkins announcing “Project Crypto” at the SEC, and the start of a digital asset sprint to implement PWG report recommendations at the CFTC.

Unrelated to the PWG report, the SEC voted to approve orders to permit in-kind creations and redemptions by authorized participants for crypto asset exchange-traded product (ETP) shares.

Read more below

Analysis: President’s Working Group on Digital Asset Markets Report

The President’s Working Group on Digital Asset Markets (PWG) released its 180-day report on July 30, 2025. The report outlines current law, discusses gaps in digital asset regulation, and proposes recommendations related to market structure, banking, stablecoins and payments, countering illicit finance, and taxation.

Zero One Strategies has prepared a series of analysis of the PWG recommendations. The first analysis is focused on the PWG recommendations for digital asset tax guidance and legislation.

Read the analysis here. 

Primer: Digital Asset Tax Policy

This document examines the principal policy proposals for digital assets taxation and provides a comparison of how lawmakers and the Trump Administration envision balancing innovation with a modernized tax system. It will be updated as legislative proposals advance. 

Read the paper here.

Noteworthy Highlights of the Week

ADMINISTRATION

Securities and Exchange Commission (SEC)

• SEC Chair Paul Atkins delivered remarks at the America First Policy Institute, in which he detailed the SEC’s “Project Crypto,” saying, “…I would like the world to go on notice that under my leadership, the SEC will not stand idly by and watch innovations develop overseas while our capital markets remain stagnant. To achieve President Trump’s vision of making America the crypto capital of the world, the SEC must holistically consider the potential benefits and risks of moving our markets from an off-chain environment to an on-chain one. We are at the threshold of a new era in the history of our markets… today I am announcing the launch of ‘Project Crypto’—a Commission-wide initiative to modernize the securities rules and regulations to enable America’s financial markets to move on-chain.” (Remarks)

• The SEC Crypto Task Force will host a series of roundtables across the country to provide opportunities for additional stakeholders to meet with Commissioner Hester Peirce. (Press release)(Schedule)

• The SEC voted to approve orders to permit in-kind creations and redemptions by authorized participants for crypto asset exchange-traded product (ETP) shares. (Press release)

Commodity Futures Trading Commission (CFTC)

• CFTC Acting Chair Caroline Pham announced the CFTC will kick off a crypto sprint to start implementation of the recommendations in the President’s Working Group on Digital Asset Markets report. (Press release)

Treasury Department

• In advance of the PWG report release, Secretary Scott Bessent published an op-ed in the Washington Post entitled “The Roadmap to Making America a Crypto Superpower,” concluding, “The House of Representatives’ Digital Asset Market Clarity Act of 2025 is an excellent first step to bring regulatory certainty to digital asset markets. It would bring price transparency into these markets and establish clear lines between the Securities and Exchange Commission and the Commodity Futures Trading Commission, borrowing from the model in traditional financial markets of structuring rules and guidelines around regulated products and activities. As the Senate deliberates the details of this bill, it should keep the bigger picture in mind: The industry needs regulatory clarity to thrive in the United States. Without market structure legislation, the implementation of the president’s vision will be incomplete. Trump will soon deliver yet another milestone with a new report from the Presidential Working Group on Digital Assets Markets. The Trump administration will work tirelessly to implement these proposals, and Congress needs to do its part to enact market structure legislation. Under Trump’s leadership, the United States is giving entrepreneurs, investors and innovators the long-needed regulatory certainty they deserve, ensuring that America becomes and remains the crypto capital of the world.” (Op-ed)

CONGRESS

• August 5 is the deadline for stakeholder comments to be submitted in response to the Senate Banking Committee Digital Asset Market Structure Request for Information. (RFI)

About Zero One Strategies

Zero One Strategies is a boutique government relations practice dedicated to navigating the complex landscape of U.S. federal policy in emerging technologies. As advancements in technology continue to outpace regulatory frameworks, Zero One Strategies aims to provide strategic guidance and bipartisan advocacy for innovators and businesses operating at the forefront of technological development.

The practice focuses on key areas such as artificial intelligence, blockchain, decentralized technologies, cybersecurity, data, and digital infrastructure, as well as the multiple policy issues impacting these sectors, including tax and financial services.

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