The White House Supports Repeal of “Broker DeFi Rule” Targeting Cryptocurrency Industry
The White House has announced its support for a congressional resolution aimed at repealing the controversial “Broker DeFi Rule,” a regulation that has come under fire for its impact on the cryptocurrency industry and decentralized finance (DeFi) platforms.
Administration Backing
White House cryptocurrency and artificial intelligence chief, David Sacks, has confirmed the administration’s support for the Congressional Review Act (CRA) resolution put forth by Senator Ted Cruz and Representative Mike Carey. The resolution, known as SJ Res. 3, seeks to overturn an Internal Revenue Service (IRS) rule issued on December 30, 2024, which expanded the definition of “intermediary” to include software handling DeFi transactions.
Implications of the Rule
The rule mandates that certain DeFi participants report gross proceeds from cryptocurrency sales and other digital asset transactions, along with detailed information about the relevant taxpayer. The administration has expressed concerns over the broad implications of this regulation on the digital asset ecosystem, citing privacy issues and the potential compliance burden on American DeFi companies.
In a Statement of Administration Policy, it was noted that the rule, issued in the final days of the previous administration, could hinder American innovation and raise privacy concerns regarding the sharing of taxpayer personal information. The administration is committed to fostering a regulatory environment that promotes innovation, job creation, and economic prosperity for all Americans.
Resolution Details
If passed by Congress, the resolution would effectively nullify the IRS rule. The White House has indicated that should SJ Res. 3 reach President Trump’s desk, his senior advisers would recommend signing it into law.
*This post is for informational purposes only and does not constitute investment advice.