President Trump Signs Resolution Erasing IRS Rule Targeting DeFi
In a significant move for the cryptocurrency sector, President Donald Trump has signed a resolution that effectively exempts decentralized financial (DeFi) platforms from being classified as brokers under the U.S. Internal Revenue Service (IRS) requirements. This development is a pivotal moment for the crypto industry, as it alleviates the burden of complex reporting obligations that were initially imposed during the final days of former President Joe Biden’s administration.
Background and Legislative Journey
The IRS rule, which has now been nullified, mandated that DeFi platforms track and report user activity akin to traditional financial brokers. This requirement was met with resistance within the industry, prompting legislative action. Representative Mike Carey, a Republican from Ohio, played a crucial role in championing the effort to overturn the rule. He stated, “The DeFi Broker Rule needlessly hindered American innovation, infringed on the privacy of everyday Americans, and was set to overwhelm the IRS with an overflow of new filings that it doesn’t have the infrastructure to handle during tax season.”
The resolution’s passage is notable for being the first pro-crypto measure to successfully navigate through the U.S. Congress. The decision saw bipartisan support in both the Senate and the House of Representatives, reflecting the growing influence and recognition of the cryptocurrency sector within legislative circles.
Implications for Future Crypto Legislation
With this regulatory hurdle cleared, the focus now shifts to other pressing legislative matters within the crypto space, particularly those involving stablecoins and market regulations for crypto transactions. The recent development is seen as a positive indicator for the industry’s potential success in future legislative endeavors.
The DeFi Education Fund celebrated the signing, stating on their website, “With President Trump’s signature, the rule is officially disapproved and voided, and the United States has passed its first ever crypto legislation — a watershed moment for DeFi.”
Next Steps in Crypto Legislation
The momentum generated by this resolution is expected to carry over to upcoming legislative efforts, particularly concerning stablecoins. Both the House and Senate have seen relevant committees approve bills on stablecoin regulation, which are now awaiting floor votes. These efforts are aligned with President Trump’s call for a comprehensive bill to be presented by August.
As lawmakers work to finalize these regulations, the industry remains optimistic about the potential for meaningful legislative frameworks that can support and foster innovation within the crypto space.
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