NAIROBI (CoinChapter.com) — Following former President Donald Trump’s address at the Bitcoin 2024 Conference, a bold new proposal has surfaced. The USABTC policy group is leading an initiative to create a Bitcoin Tax-Free Zone in the United States. Dubbed the “Digital Economic Zone (DEZ),” the zone would allow for Bitcoin transactions and holdings to be free from capital gains taxes.
Donald Trump’s pro-crypto stance may have influenced this proposal. At the 2024 Bitcoin conference conference, Trump said,
“I will end Joe Biden’s war on crypto, and we will ensure that the future of crypto & Bitcoin will be made in America!”
The DEZ could align with this vision by using Bitcoin’s potential to secure the U.S. financial future. It would maintain the U.S. dollar’s dominance while attracting investors. The tax-free gains within the DEZ could drive wealth growth. Revenue would come from exit taxes, benefiting both federal and state treasuries.
Why USABTC’s Bitcoin Tax-Free Zone Matters
DEZ may position the U.S. as a leader in the digital economy, especially amid a growing regulatory rivalry with growing crypto-friendly destinations like the U.A.E., Switzerland, El Salvador, and others.
Integrating Bitcoin into the financial system would reinforce the dollar’s status as the world’s reserve currency. The DEZ would also allow the U.S. to harness Bitcoin’s decentralized power to strengthen economic resilience. Though capital gains would be tax-free, the government would still collect revenue through exit taxes. This creates a balanced approach that benefits both investors and the government.
The plan addresses concerns in the crypto community by protecting the right to self-custody. This builds trust and ensures that the system stays secure and transparent. If successful, the DEZ could solidify the U.S.’s role as a global financial leader.
Government and IRS Collaboration
USABTC proposes a phased approach starting in 2025. The President would first issue an executive directive. This directive would authorize the use of the Exchange Stabilization Fund (ESF) for Bitcoin transactions in the DEZ. The plan includes drafting legal opinions, legislative efforts, and public outreach to gain support.
The IRS would play a key role in setting up the legal framework. The agency would ensure transparency and compliance. The initiative also protects the right to self-custody Bitcoin, which is a major concern for many in the crypto community.
