US House votes to repeal IRS DeFi broker rule

The U.S. House of Representatives voted on March 11 to repeal the IRS DeFi broker rule, which would have required decentralised finance (DeFi) platforms to report detailed transaction and taxpayer information to the Internal Revenue Service (IRS).

The motion passed with bipartisan support, achieving a vote of 292-132, with 76 Democrats joining all Republicans in favor of overturning the rule.

This follows the Senate’s March 4 vote, where the resolution to nullify the rule passed with a 70-27 majority.

The Congressional Review Act was utilised to advance the measure, allowing lawmakers to bypass filibuster requirements and block similar rules in the future.

The resolution now awaits another Senate vote before being sent to President Donald Trump, who has signaled his support for its approval.

The IRS regulation, introduced during the final days of former President Joe Biden’s administration, aimed to expand reporting requirements for brokers to include DeFi platforms.

It would have mandated decentralised exchanges to disclose gross proceeds from cryptocurrency sales and provide information on taxpayers involved in transactions.

Critics argued that such requirements were impractical for DeFi protocols and posed significant privacy concerns.

Republican Representative Mike Carey, who sponsored the repeal motion, described the rule as an invasion of privacy that would hinder innovation and overwhelm tax authorities.

“The DeFi broker rule invades the privacy of tens of millions of Americans,” Carey stated after the vote.

Similarly, House Financial Services Committee Chairman French Hill called the regulation “a clear example of government overreach.”

Opposition came from Democratic Representative Lloyd Doggett, who argued that repealing the rule would create loopholes for tax evasion and money laundering.

“This exemption makes it easier for wealthy tax cheats and criminal financiers to exploit decentralised exchanges,” Doggett said during deliberations.

The crypto industry has widely supported efforts to overturn the rule.

Advocacy groups like the Blockchain Association have criticised it as unconstitutional and detrimental to financial innovation in the United States.

David Sacks, White House AI and crypto czar, echoed these concerns, stating that compliance burdens imposed by the rule could stifle American DeFi companies.