The US Senate voted to repeal an IRS rule targeting reporting obligations for DeFi platforms, gaining support from crypto companies and politicians.
US Senate Repeals IRS Rule on DeFi
The US Senate voted 70-28 to approve a resolution canceling the IRS rule targeting DeFi platforms. This rule, introduced during the Biden era, required decentralized protocols to report to the IRS like traditional brokers. The current repeal awaits President Donald Trump's signature.
Support from Politicians and Crypto Firms
The resolution was introduced by Senator Ted Cruz, who called it 'a victory for American innovation.' More than 30 crypto companies sent a letter to Congress demanding clarification on the DOJ's interpretation of money transmitter laws. Companies involved include Coinbase, Kraken, and others.
Legal Challenges and the Tornado Cash Case
In August 2023, the DOJ filed criminal charges against Tornado Cash co-founder Roman Storm, accusing him of running an unlicensed money-transmitting business. This case has raised significant concerns within the crypto industry.
The repeal of the IRS rule for DeFi platforms represents a significant victory for the crypto community but leaves many unresolved legal questions that require lawmakers' attention.
