I don't get why the US wants to tax staking income if no Fiat (USD) transactions are involved? You only pay taxes if you sell your ETH to USD. Not if you earn and "hodl" ETH without selling. At least, that's how I understood it from the very beginning.
That was one perfectly fine possibility (the one that arguably made more sense). Unfortunately, the IRS finally released the rules it decided to make up. According to these, you must pay tax at the "fair market value" of the rewards at the time you gain control of them (i.e., are able to sell).
In retrospect, this makes sense in terms for slowing down crypto adoption: If you stake, you're forced to go into cash at some point. No longer can you transact purely in crypto. In terms of maximizing the IRS's gains, it makes less sense, at least if you expect crypto to behave the same ways as since the beginning in 2009.