The United States Senate voted to repeal the Internal Revenue Service (IRS) rule concerning decentralized finance brokers (DeFi). The decision passed with 78 votes in favor and 28 against, indicating substantial support among lawmakers.
This is reported by Business • Media
The repealed rule required DeFi brokers to adhere to regulations applicable to traditional financial institutions, which included collecting user data, reporting transactions, and filing 1099 tax forms. These requirements faced criticism from the crypto industry, which advocated for the preservation of innovation and freedom of action in this sector.
Overview of the Initiative and Support
The initiative to repeal the rule was introduced by Senator Ted Cruz and Congressman Mike Carey. The bill has already received approval from both chambers of Congress and has been sent to President Donald Trump for signing. The White House has also expressed support for this decision, and the president’s advisors recommend that he sign the bill.
This rule, enacted during the administration of former President Joe Biden, faced harsh criticism. Noted businessman David Sacks called it “an attack on the crypto community.” At the end of 2024, the DeFi Education Fund, along with the Blockchain Association and Texas Blockchain, filed a collective lawsuit against the IRS, claiming that the new requirements threaten innovation in the U.S. and force tech companies to seek opportunities abroad.
“This is a critically important step to protect developers and technological progress in the U.S.,” stated Amanda Tuminelli, executive director of the fund.
Prospects for the Crypto Industry
According to Ron Hammond, senior director of government relations at the Blockchain Association, if the bill is signed, it will be the first crypto regulatory law that Trump signs upon returning to the White House. Such a decision could serve as an important signal for crypto investors and startups interested in developing new technologies in the decentralized finance sector.
It is worth noting that the U.S. Securities and Exchange Commission (SEC) previously backed off on regulating DeFi brokers, which also indicates a shift in approaches to regulating the crypto industry in the country.