On March 4, the US Senate released the Congressional Review Act to withdraw a regulations from the BIDen era that is generally known as the Defi rule broker. This rule required decentralized financial platforms to share user data with the Internal Revenue Service.
The CRA is set to cancel gross revenues that reports by brokers that regularly offer services that effect the sale of digital assets (or simply “broker Defi rule”) made by Senator Ted Cruz and 13 co -sponsors. The vote on the cancellation of the rule was planned for 5 March, but it can take place later due to planning conflicts.
According to Cruz’s policy policy, the rule has expanded the definition of “broker” with software that offers access to decentralized financial platforms, so that the Defi -sector is effectively placed under IRS supervision.
The Defi rule broker has the Defi platforms to subject users to know your customer politics, to report gross revenue from transactions and other promotions on the platforms and to share the data of the taxpayers with the agency. In CRA, the Defi rule broker is described as a compliance with the US Defi companies. Another problem with the rule is the privacy problems.
The rule was assumed in the last days of the BIDEN administration on December 30, 2024 and came into force on January 1, 2025. However, Defi-platforms were not expected to comply with compliance with compliance obligations to 2027. Cruz and his co-sponsors dronged to the president and claimed to be in place and claimed the innovation that the Innovation was in place of the Innovation of the Innovation of the Innovation of the Innovation to be in place of the Innovation of the Inovation and the Cra. Strengthen.
David Sacks, the Crypto advisor of the White House, expressed support for the CRA on X.
Why is the Defi rule broker rule problematic?
The crypto industry has opposed the Defi rule broker from the start and claims that it misunderstands how decentralized finance works. The rule assumes that Defi platforms act as intermediaries, such as traditional brokers, instead of front-end services that facilitate peer-to-peer transactions.
htts
The Defi rule broker wrongly suggests that Defi platforms (such as real brokers) serve as intermediaries between their counterparts. The regulators apparently do not understand that decentralized financial platforms act as the front-end services that facilitate peer-to-peer transactions, connect the counterparts but do not check.
Kristin Smith of Blockchain Association called the rule unconstitutional because it violates the Action Procedure and exceeds the legal authority of the IRS and the Ministry of Finance. The joint explanation From the Association, Defi Education Fund and Texas Blockchain Council, the Blockchain Association Head of Legal Marisa Coppel quotes: “This is not just a violation of the privacy rights of people who use decentralized technology, it would push this whole, fast -growing technology offshore.”
The activists warned that this ‘midnight decision’ of the BIDEN administration would paralyze the Defi sector, not only impose a burden on entrepreneurs, but is also an existential threat to industry. No wonder that the announcement of the White House support for the cancellation of the Defi rule broker was received with great enthusiasm.
What is the chance that the rule will be withdrawn?
The Defi rule broker does not correspond to the pro-crypto attitude of the current administration. It is in contradiction with the aim of keeping the cryptocurrency sector private and free from government monitoring. Since the Trump government has explicitly prohibited the development of digital currency of the central bank, a mood to withdraw the rule would be consistent with its policy direction.
More than that, during his presidential campaign in the summer of 2024, Trump promised tax reduction for the Crypto companies from the US. The Defi rule broker, the American Defi platforms effectively pushes offshore because of the unlikely demand for collecting and sharing the personal information of users. Given these facts, the rule has a great chance of being withdrawn.
Moreover, the rule itself was submitted by the IRS, and Donald Trump expressed his willingness abolish the IRS absolutely. Earl Carter’s respective proposal has already been created. However, it is too early to assess whether something like that takes place. Nevertheless, that is another argument in favor of the great probability of the success of the CRA introduced by Ted Cruz.
