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  • Debashree Patra
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    Fun-loving and cheerful, a passionate blockchain and crypto writer who knows no boundaryโ€ฆconnect if you share the same passion. With 10+ years of writing experience, I am a Crypto Journalist by chance, exploring, and learning all the dynamics of the sci-fi action-filled crypto world. Currently, focusing on cryptocurrency news and price data. With a passion for research and challenging my capabilities, I am slowly getting into the crypto arena to bring new insights every day.

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    Donald Trump May End IRS DeFi Tax Rule After Senate Vote

    A major tax rule targeting decentralized finance (DeFi) could soon be wiped out, as U.S. President Donald Trump is expected to sign a resolution repealing it. The rule, introduced during the Biden administration, required DeFi platforms to report crypto transactions to the IRS, much like traditional financial institutions.

    Senate Votes to Overturn Crypto Reporting Requirements

    The Senate voted 70-28 in favor of repealing the rule, following a similar decision by the House earlier this month. The legislation had been widely criticized by the crypto community for being impractical and harmful to innovation. Supporters of the repeal argue that DeFi platforms operate differently from centralized financial entities and should not be subjected to the same reporting rules.

    Critics Say the Rule Was Unworkable

    Crypto advocacy groups, including the Blockchain Association, praised the Senateโ€™s decision, calling it a victory for DeFi innovation. 

    Kristin Smith, CEO of the Blockchain Association, expressed gratitude to Senator Ted Cruz, Representative Mike Carey, and other lawmakers for voting to overturn a rule that could have restricted crypto and DeFi innovation. She emphasized that their leadership helps secure the future of digital assets in the U.S. and is now looking forward to Donald Trumpโ€™s final approval to scrap it permanently.

    However, some experts argued that the rule was unrealistic and would have placed excessive burdens on decentralized platforms, making compliance nearly impossible.

    However, opponents of the repeal, such as Democratic Representative Lloyd Doggett, warned that removing the rule could open doors for tax evasion and illicit financial activities. He claimed that keeping the regulation in place would have helped prevent wealthy investors from exploiting tax loopholes.

    Whatโ€™s Next?

    With Trump expected to approve the repeal, the rule will soon be off the books. The decision highlights the shifting political landscape around crypto regulation as the industry gains stronger support in Washington. For now, DeFi platforms can breathe a sigh of relief, knowing they wonโ€™t have to comply with the IRS reporting requirements that many saw as an existential threat to the sector.

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