- U.S. Senate passed a resolution (70-28) to overturn an IRS rule requiring crypto sales reporting, with significant bipartisan support.
- The IRS rule, finalized in December 2024 under the Biden administration, would have expanded the definition of “broker” to include DeFi protocols.
- The Trump administration has formally backed the repeal effort, with the resolution now awaiting House approval before reaching the President’s desk.
The U.S. Senate delivered a decisive blow to cryptocurrency reporting requirements on Wednesday, voting 70-28 to overturn an Internal Revenue Service rule that would have mandated brokers to report gross proceeds from digital asset sales. The bipartisan vote represents a significant victory for the cryptocurrency industry and aligns with the current Trump administration’s pro-crypto stance.
In a remarkable display of cross-party cooperation, the Congressional Review Act resolution garnered substantial Democratic support despite the rule having originated during the Biden administration. Kristin Smith, CEO of the Blockchain Association, described the bipartisan backing as “absolutely mind-blowing.”
The resolution now faces a critical next step – passage in the House of Representatives. If successful there, it will advance to President Trump’s desk, where approval appears likely given the administration’s vocal support for the measure.
At the center of the controversy is an IRS rule finalized during the final weeks of the Biden presidency in December 2024. This regulation significantly expanded the definition of a “broker” in the cryptocurrency space to include decentralized finance (DeFi) protocols – autonomous software programs that facilitate crypto transactions without traditional intermediaries.
Industry advocates argued forcefully against the rule, claiming it would impose impossible compliance requirements on permissionless financial systems. Critics maintained that the regulation would force DeFi platforms to register as traditional brokers and require all U.S. DeFi users to link their blockchain addresses to their personal identities – fundamentally altering how these systems operate.
A spokesperson for the DeFi Education Fund characterized the Senate vote as a landmark moment, stating: “Today marks the first of many historic milestones in the regulation of digital assets in the United States in this next chapter—as we move towards the enactment of the first standalone crypto legislation.”
The spokesperson added: “The DeFi Education Fund applauds the bipartisan supermajority of Senators who recognized the need to push back against regulatory overreach to protect Americans’ freedom to choose how they transact and American innovation.”
On Tuesday, the Trump administration formally backed the repeal effort through David Sacks, Trump’s crypto policy chief. Sacks expressed that the White House “strongly supports” the resolution, criticizing the previous administration’s approach.
“This rule, issued as a midnight regulation in the final days of the previous administration, would stifle American innovation and raise privacy concerns over the sharing of taxpayers’ personal information, while imposing an unprecedented compliance burden on American DeFi companies,” Sacks stated.
The Senate vote represents the first major cryptocurrency policy victory in the new administration, potentially setting the tone for future regulatory approaches to digital assets in the United States.
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