Crypto Regulation Shake-Up: US House Moves to Repeal DeFi Broker Rule
Crypto Regulation Shake-Up – A significant resolution has emerged in the US House of Representatives aiming to repeal the “DeFi broker rule”, a regulation that would require brokers to report digital asset transactions to the Internal Revenue Service (IRS). This rule, which is set to take effect in 2027, was approved by the IRS on December 5 and seeks to expand existing reporting requirements to cover decentralized exchanges. It would obligate brokers to disclose gross proceeds from cryptocurrency sales, including detailed information about the taxpayers involved.
House Committee Votes to Overturn DeFi Broker Rule
On February 26, the House Ways and Means Committee, a key financial committee within the US House of Representatives, voted 26 to 16 to pass the resolution to repeal the rule. Miller Whitehouse-Levine, CEO of the DeFi Education Fund, expressed strong opposition, calling the rule an “unlawful and unconstitutional overreach.” He stressed that repealing the rule is essential to protect Americans’ freedom of choice in how they conduct transactions.
Whitehouse-Levine urged lawmakers and those in favor of financial innovation to act swiftly, emphasizing the importance of maintaining the US’s position as a hub for digital assets.
The Path Ahead for the Resolution
If the resolution passes through the House, it will move to the Senate, where further deliberations will take place. If approved, the bill will then go to US President Donald Trump, who will either veto or sign it into law.
Concerns Over Digital Asset Leadership
Jason Smith, Chairman of the House Ways and Means Committee, voiced concerns that the rule could harm America’s leadership in digital assets. He criticized the regulation for being unworkable, pointing out that DeFi brokers do not even collect the necessary information from users to implement it effectively. Smith also noted that the rule could create an unmanageable burden for the IRS, which has struggled with similar regulations in the past.
As the debate continues, many see the growing pro-crypto stance in Congress as a turning point for the US crypto industry, with positive changes already underway, such as the Securities and Exchange Commission dropping several cases against crypto firms in February.
Disclaimer: This article is for informational purposes only and does not constitute investment advice. Cryptocurrencies and stocks, particularly in micro-cap companies, are subject to significant volatility and risk. Please conduct thorough research before making any investment decisions.
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