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US Lawmakers Push to Overturn IRS Crypto Broker Rule
On March 5, a bipartisan effort is underway in Congress to overturn an Internal Revenue Service (IRS) regulation that would impose stringent reporting requirements on decentralized finance (DeFi) platforms. The Congressional Review Act (CRA) resolution, led by Republican Senator Ted Cruz and Representative Mike Carey, aims to nullify the rule, which critics argue could stifle blockchain innovation and impose undue compliance burdens.
The White House has expressed support for the CRA resolution, signaling a potential shift toward a more innovation-friendly approach to digital asset regulation. On Tuesday, David Sacks, the administration’s crypto policy advisor, criticized the IRS rule, labeling it an “11th-hour attack on the crypto community.”
The IRS rule, finalized in December, expands the definition of a “broker” to include software developers and front-end operators of DeFi platforms. Under this regulation, these entities would be required to report gross proceeds from crypto sales and collect taxpayer data, including user identities and transaction histories.
Critics argue that this approach misinterprets DeFi’s decentralized nature. The resolution, designated as S.J. Res. 3 , was introduced on January 21 and has gained traction among lawmakers concerned about its potential impact on the digital asset sector.
Industry opposition and concerns over regulatory overreach have been voiced by crypto advocacy groups, including the Blockchain Association, which warns that this rule could drive blockchain innovation out of the United States.
If the resolution passes both the Senate and House, it would overturn the IRS regulation, preventing its enforcement. The outcome of this vote could set a precedent for future regulatory efforts affecting the cryptocurrency sector.
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**Author:** Nakamura Haruto
Source: https://www.kanalcoin.com/us-lawmakers-push-to-overturn-irs-crypto-broker-rule/
