- The Trump administration is backing efforts to repeal an IRS rule that expands the definition of DeFi brokers.
- Critics argue the rule could push companies offshore, but it isn’t set to take effect until 2027.
- Trump has signed multiple pro-crypto executive orders and plans to host a White House crypto summit on March 7.
David Sacks, the Trump administration’s AI and crypto czar, announced that the White House is backing congressional efforts to repeal the IRS’s controversial decentralized finance (DeFi) broker rule.
In a March 4 post on X, Sacks voiced support for resolutions introduced by Texas Senator Ted Cruz and Ohio Representative Mike Carey under the Congressional Review Act. The resolutions aim to overturn a regulatory rule that broadens the definition of a “broker” to include software providers enabling access to DeFi protocols. Sacks stated that President Donald Trump’s senior advisers would recommend signing joint resolution S.J. Res. 3 into law if Congress sends it to the president’s desk.
“This rule, issued as a midnight regulation in the final days of the previous administration, would stifle American innovation and raise privacy concerns over the sharing of taxpayers’ personal information while imposing an unprecedented compliance burden on American DeFi companies,” officials from the Office of Management and Budget declared in a March 4 statement.
Regulatory Backlash and Industry Concerns
The rule, introduced by the IRS in December 2024 before Trump took office, immediately sparked backlash from the crypto industry. Critics argue that the policy could drive companies offshore or hinder technological progress. However, the rule is not set to take effect until 2027.
Under the IRS policy, if a DeFi platform facilitates the exchange or sale of digital assets and exerts sufficient control over transactions, it could be classified as a broker and subjected to additional reporting requirements. Government estimates suggest that between 650 and 875 DeFi brokers would be affected, requiring them to start collecting data in 2026.
Trump Administration’s Crypto-Friendly Agenda
The push to repeal the IRS rule is just one of several pro-crypto measures from the Republican-led Senate, House, and executive branch since taking office in January. Trump has already signed multiple executive orders favorable to the crypto sector and has announced plans to host a White House crypto summit on March 7.
With the administration taking an aggressive stance in reshaping crypto regulation, the industry is closely watching to see how far these policy shifts will go.
