US President Donald Trump signed into law a bill on Thursday
to overturn a revised rule by the Internal Revenue Service (IRS) that expanded
the definition of a broker to include decentralized cryptocurrency exchanges.
The decision follows a broader policy shift announced
earlier. Trump said he would temporarily suspend tariffs on many US trading
partners while sharply increasing them on Chinese imports. The move reversed
course less than 24 hours after new levies triggered a global market downturn.
The White House said the pause would last 90 days for countries willing to
negotiate new trade agreements.
IRS DeFi Rule Faces Legislative Repeal
The IRS rule, issued in the final weeks of the Biden
administration, was updated in December 2024 to clarify that it would apply to
decentralized finance (DeFi) exchanges. In response, both the House of
Representatives and the Senate voted in March to reverse the IRS revision
through the Congressional Review Act.
Trump just signed the first-ever crypto bill — repealing the IRS DeFi rule.No more tax reports for every LP txn Holdstation users rn: 🍯💸📈🛏️ pic.twitter.com/mOQZ7v0xCz
— Holdstation – The DeFAI Smart Wallet (@HoldstationW) April 11, 2025
The crypto industry criticized the revised rule, arguing
that it was unworkable for DeFi platforms. They stated that since DeFi
exchanges do not act as intermediaries and do not have user data, they could
not comply with the IRS reporting requirements.
You may want to read at financemagnates.com: President
Trump Creates Crypto Working Group, Bans Digital Dollar.
IRS Rule Targets DeFi Tax Reporting
Centralized exchanges like Coinbase and Kraken act as
intermediaries, while DeFi platforms allow users to transact directly on
blockchain networks. The IRS rule, part of the 2021 bipartisan Infrastructure
Investment and Jobs Act, aimed to ensure tax compliance by requiring brokers to
send tax forms to both the IRS and digital asset holders.
Trump, who had previously expressed support for the
cryptocurrency industry, had pledged to be a “crypto president.”
During his time in office, he ordered the creation of a cryptocurrency working
group and signed an executive order to create a federal bitcoin stockpile.
This article was written by Tareq Sikder at www.financemagnates.com.
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