The US Senate voted 70-27 to cancel an internal income service rule which would have imposed new declaration requirements on decentralized finance brokers.
As Business Insider reported, the request presented by Senator Ted Cruz, was approved under the Congressal Review Act on March 4, indicating that the two parties were against the Biden era rule. Presented in December, the IRS DEFI rule required DEFI platforms to report user data for fiscal compliance, thus expanding the definition of “brokers” to include them.
Since decentralized platforms do not hold funds or do not retain customer data in the same way as traditional financial institutions, criticisms said that the law was not practical. The Center for City of the Digital Assets Center for Digital Assets has described the proposal for “technologically impracticable”.
“Administration Biden has done everything it could to stifle financial innovation in the United States,” said the head of the majority of the Senate John Thune (Rs.d.) in a statement. “The Senate strives to cancel these heavy regulations one both to restore the financial freedom of the American people.”
The resolution must always adopt the House of Representatives in order to be delivered to President Donald Trump for final approval, even after the Senate approved it. In addition to being forbidden to enforce the rule, the IRS would also be prohibited to promulgate similar policies in the future if the rule should become law.
Supporting the abrogation, the Blockchain Association, which represents popular cryptocurrency companies like Coinbase, Kraken and Uniswap Labs, said that it would avoid the unnecessary limitations of DEFI innovation. According to the DEFI Education Fund, the Senate vote was the “first of the many historical stages of the regulation of digital assets in the United States”.
This vote echoes previous attempts to remove the accounting standards of the securities commission for digital assets and pursues a trend in bipartite legislation linked to cryptography.
The Senate’s decision could stage the scene for more extensive regulatory reforms, because the legislation on the structure of the Stablescoin market and cryptocurrencies should be on the agenda.
A counterpart resolution has already been approved by the Chamber’s Financial Services Committee, and a final vote is still pending. According to the White House, President Trump should sign the bill as soon as possible.
