The United States Senate has adopted a resolution aimed at abolishing a rule established during the Biden administration that would mandate decentralized finance (DeFi) platforms to report to the Internal Revenue Service (IRS).
The Senate approved the motion with a vote of 70 to 27 on March 4 to overturn the proposal set to broaden the current IRS reporting obligations to encompass decentralized exchanges and obligate brokers to reveal gross revenues from cryptocurrency transactions, which includes disclosing information about taxpayers engaged in the dealings.
The resolution is now headed to the House, where it must be passed before being presented to President Donald Trump. The White House’s AI and crypto advisor, David Sacks, has mentioned that Trump endorses eliminating the rule.
The Senate passed the motion to revoke the IRS’ DeFi broker rule with a vote of 70 to 27 on March 4. Source: US Senate
This comes in the wake of a similar initiative by House members, who moved forward with a resolution to repeal the rule on February 26, which is still awaiting a vote.
Eli Cohen, the legal counsel for the RWA tokenization platform Centrifuge, stated in an assertion to Cointelegraph that the rule was never “logical and was impractical in execution.”
Nonetheless, considering that it was never enacted, all the stipulations remain unchanged, he further explained.
“It simply implies that the taxpayer must report directly to the IRS without an intermediary fulfilling this requirement,” Cohen commented.
Kristin Smith, the CEO of the crypto advocacy organization The Blockchain Association, stated in a post on X dated March 4 that it marked a significant day for “DeFi – and the US cryptocurrency sector.”
“The endeavor to abolish this rule ought to be recognized as part of a larger strategy to maintain crypto within the US,” she remarked.
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“DeFi stands as an American strategic advantage, and today’s action assists in ensuring its continued advancement on domestic ground,” Smith added.
Smith remarked that this is the most pro-crypto Congress thus far, and the resolution passing through the Senate represented the first instance that sentiment translated into action.
“This is promising for the initiatives aimed at crafting and passing legislation concerning stablecoins and market structure,” Smith noted.
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