Bloomberg reported Friday that the U.S. Internal Revenue Service (IRS) will exempt certain crypto developers, miners, and hardware sellers from the bipartisan infrastructure bill's tax reporting requirements for brokers as a peace offering to the young U.S. crypto industry.

Bloomberg cited an anonymous official saying the Treasury will choose not to enforce the law on crypto entities that do not meet the tax code's traditional definitions of a broker, with detailed guidance to come next week. Critics have labeled the bill's crypto provision overbroad and onerous, forcing developers and miners to provide reporting information they cannot actually collect. The Treasury statement could offer a workaround by limiting the bill's scope to entities already classified as brokers under current tax law, but an exemption would reportedly apply to entities on a case-by-case basis, which is narrower than the broad exemption the industry wants.

Here is the other week in review:

Circle Internet Financial, the developer and issuer of the popular USD Coin (USDC) stablecoin in conjunction with Coinbase (COIN  ), unveiled that it filed with the Securities and Exchange Commission to become a U.S. national bank. Founder and CEO Jeremy Allaire wrote in a post that the fintech firm has started the process of becoming a full-reserve national commercial bank. The bank would operate under the regulatory watch of the Federal Reserve, Treasury, Office of the Comptroller of the Currency, and the Federal Deposit Insurance Corporation. He noted that USDC circulation has grown to a whopping $27.5 billion so far: "USDC has grown to become an important infrastructure for the new digital currency enabled financial system." Allaire said Circle believes that digital banking could change the entire global financial system by making it safer and stronger. The big move comes as Circle prepares to go public via a merger deal with special purpose acquisition corporation Concord Acquisition Corp (CND  ) in the near future.

Polygon, a popular protocol for Layer 2 solutions on Ethereum, announced Friday it is acquiring blockchain network Hermez for 250 million MATIC worth $250 million in the first ever complete merger of one blockchain network into another. Although several Ethereum projects have unveiled mergers of protocols into a decentralized autonomous organization before, Polygon's absorption of Hermez's team and protocol is new. Hermez is a zero-knowledge rollup, which uses mathematical proofs to verify and settle Ethereum transactions. As Ethereum struggles with transaction bottlenecks and high gas fees, rollups have become the preferred scaling strategy, and Hermez is the only decentralized rollup. The merger with Hermez is part of Polygon's new strategic focus on zero-knowledge technology. Polygon also pledged a $1 billion commitment to further developing zero knowledge-based systems, forming partnerships, hiring employees, and acquiring teams and projects.

Crypto prices rose to $2 trillion this week amid a strong uptrend. For the majors, XRP, Cardano (ADA), and Dogecoin (DOGE) posted outsized gains, while all coins ended in the green. In the top 100, the biggest losers were Celsius (CEL), down 2.6%, and OKB, down 1.1%. The biggest gainers were Revain (REV), up a massive 80%, XinFin Network (XDC), up 74%, and XRP, up 65%. Next week traders will watch if Bitcoin (BTC) and Ether (ETH) can regain the key $50,000 and $3,500 levels.

The author owns a small amount of BTC.