The US Senate has voted to repeal the controversial DeFi Broker Rule, which required decentralized platforms to collect KYC data. This decision marks a significant victory for the crypto industry.
Senate Overturns DeFi Broker Rule
The US Senate has voted, with 70 votes in favor, to repeal the DeFi Broker Rule, which mandated decentralized platforms to adhere to KYC norms. The decision followed prior approval by the House of Representatives. If signed by the President, the IRS will lose its authority to enforce such crypto regulations.
What Was the IRS DeFi Broker Rule?
Last year, the IRS defined any platform facilitating crypto transactions as brokers. The rule was virtually unenforceable on decentralized exchanges, P2P platforms, and crypto wallets. This regulation raised concerns industry-wide, with the Blockchain Association warning of potential negative impacts on innovation within the US.
Trump’s Longstanding Feud with the IRS
Former President Donald Trump frequently criticized the IRS for overreaching and bias. His administration sought to reduce IRS influence, a notion still resonating with his supporters.
The repeal of the DeFi Broker Rule is a significant win for cryptocurrency advocates, though the debate over IRS oversight remains ongoing. Uncertainty around crypto taxation persists.
