In a significant move for the cryptocurrency sector, President Donald Trump has signed into law a bill nullifying a revised Internal Revenue Service (IRS) bill that sought to broaden the definition of "broker" to include decentralized finance (DeFi) platforms. This decision effectively removes stringent tax reporting requirements that the crypto industry argued were unworkable for DeFi exchanges.

 

IRS Bill Overturned: Relief for DeFi Platforms

 

The now-nullified IRS bill, finalized in late 2024 during the previous administration, aimed to classify DeFi exchanges as brokers, thereby subjecting them to the same tax reporting obligations as centralized platforms like Coinbase and Kraken. Critics contended that DeFi platforms, which facilitate peer-to-peer transactions without intermediaries, lack the necessary user data to comply with such requirements.

 

Congressional Action and Industry Response

 

In response to widespread industry pushback, both chambers of Congress voted in March to overturn the IRS bill revision through the Congressional Review Act, which allows for the reversal of federal regulations with a simple majority. The crypto community lauded this legislative action, viewing it as a victory for innovation and privacy within the digital asset space.

 

Donald Trump's Pro-Crypto Stance Solidified

 

President Donald Trump's decision to sign the bill aligns with his broader pro-crypto agenda. Earlier this year, he established a cryptocurrency working group tasked with developing new digital asset regulations and signed an executive order to create a federal bitcoin reserve. These actions underscore Donald Trump’s commitment to fostering a favorable environment for blockchain technology and digital currencies in the United States.

 

This legislative development marks a pivotal moment in U.S. crypto policy, potentially setting the stage for increased adoption and innovation within the digital asset ecosystem.

 

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