The US Senate passed a resolution to repeal a Biden-era rule requiring DeFi protocols to report to the IRS, signaling a shift in crypto regulatory policy under Trump.
The US Senate has moved to overturn a controversial Biden administration rule that would have classified DeFi protocols as brokers for IRS reporting purposes.
Senate Votes to Overturn DeFi Broker Rule
The US Senate passed a joint resolution on Thursday to repeal the Treasury Department’s controversial rule that would have required decentralized finance (DeFi) protocols to report user transactions to the Internal Revenue Service (IRS). The 51-48 vote sends the measure to President Trump’s desk for final approval.
Senator Cynthia Lummis (R-WY), a prominent crypto advocate, announced the vote on her official Twitter account, calling it ‘a victory for financial innovation and privacy.’ The rule was originally proposed by the Biden administration in 2021 as part of broader infrastructure legislation.
Industry Reacts to Regulatory Shift
Coin Center, a leading cryptocurrency think tank, released a statement praising the Senate’s action. ‘This resolution recognizes that decentralized protocols can’t reasonably comply with traditional broker requirements,’ the organization wrote in a blog post. Major DeFi platforms including Uniswap and Aave had previously warned the rule would force them to either shut down US operations or fundamentally alter their decentralized nature.
The Blockchain Association called the vote ‘a critical step toward sensible crypto regulation’ in a press release. Meanwhile, Treasury Secretary Janet Yellen expressed disappointment, telling reporters the rule was ‘necessary to prevent tax evasion in this growing sector.’
What Comes Next?
With President Trump expected to sign the resolution, the Treasury Department will need to develop alternative approaches to cryptocurrency tax compliance. Congressional sources indicate new legislation may be introduced that distinguishes between centralized exchanges and truly decentralized protocols. The resolution’s passage marks the first major crypto policy shift since the Trump administration took office in January 2025.
