🚨 Senate Moves to Kill IRS Broker Rule Targeting DeFi �*

On March 27, the U.S. Senate will vote on a resolution to overturn the IRS broker rule, which requires DeFi platforms to comply with traditional financial regulations. If passed, the measure heads to President Donald Trump, who could sign it into law as early as March 28.

🧐 What Is the IRS Broker Rule?

Finalized in December 2023, this rule expands the definition of "brokers" to include:

• DeFi platforms
• Crypto exchanges
• Certain digital asset protocols

This classification forces them to:
✅ Collect user data (KYC requirements)
✅ Monitor and report transactions to the IRS
✅ Comply with tax reporting laws originally designed for centralized brokers

The rule was introduced by the Biden administration as part of an effort to close tax loopholes in the crypto industry.

🛑 Why Is the DeFi Community Fighting Back?

Crypto advocacy groups, including the Blockchain Association and DeFi Education Fund, argue that:
🚫 DeFi doesn’t have intermediaries – there’s no "broker" to report transactions.
🚫 It’s technically impossible – smart contracts can’t collect KYC info.
🚫 It could drive DeFi innovation out of the U.S. – making the country less competitive.

In December 2023, these organizations sued the Treasury Department, arguing the rule oversteps federal authority and threatens the decentralized nature of DeFi.

⚖️ What’s the Senate Doing?

The Senate is expected to pass the resolution with bipartisan support. If it goes through:
✅ The IRS will no longer enforce the rule on DeFi platforms.
✅ The U.S. crypto industry gets breathing room from heavy-handed regulation.
✅ Trump could sign the repeal into law as soon as March 28.

🔮 What’s Next for DeFi Regulation?

Even if this rule is overturned, regulators won’t stop trying to tax and regulate DeFi. Future proposals could include:

• New reporting requirements targeting liquidity providers and validators
• Alternative tax frameworks for crypto transactions
• A push for greater control over self-custodial wallets

For now, this vote represents a win for the DeFi sector, but the battle over regulation is far from over.

⚡ TL;DR

• The Senate votes on March 27 to repeal the IRS rule forcing DeFi platforms to act as "brokers."
• The rule, introduced in 2023, would require KYC, transaction reporting, and compliance with tax laws.
• The DeFi community argues it’s impossible to enforce and would hurt the U.S. crypto industry.
• A bipartisan Senate majority supports the repeal; if passed, Trump could sign it into law on March 28.
• Even if overturned, DeFi regulations are far from over—expect new proposals soon.

👀 Will the U.S. finally embrace DeFi, or is this just a temporary win?