President Donald Trump signed his first crypto-related bill into law Thursday, formally eliminating a Biden-era IRS rule that would have required decentralized finance platforms to collect and report the same taxpayer information as traditional brokers.
The bill is, in fact, not just the first crypto-related bill made law by Trump, but also the first crypto-related bill signed by any U.S. president.
The resolution knocks down the IRS’s so-called DeFi broker rule, which was first proposed by the Biden administration in 2023.
U.S. Representative Mike Carey (R-Ohio), who attended the signing ceremony, said that by repealing the rule, the IRS now has an opportunity to “return its focus to the duties and obligations it already owes to American taxpayers.”
“The DeFi Broker Rule needlessly hindered American innovation, infringed on the privacy of everyday Americans, and was set to overwhelm the IRS with an overflow of new filings that it doesn’t have the infrastructure to handle during tax season,” he said in a statement.
The repeal received considerable bipartisan support last month in both the House and Senate—a remarkable result that underscored the willingness of many Democrats to directly rebuke the policies of their former party leader within months of his leaving the White House.
Industry leaders vocally objected to the IRS rule as soon as it was announced, arguing that it would destroy DeFi in the United States.
Decentralized finance protocols, which run on automated code, were, on their face, incapable of complying with stringent tax reporting requirements designed for traditional brokers, these critics maintained.
Nonetheless, in the waning hours of Biden’s lame duck presidency, the IRS instituted the rule anyway, enraging industry leaders and pro-crypto lawmakers alike.
The Trump administration threw its support behind the measure last month, with White House AI and crypto czar David Sacks slamming the IRS DeFi rule as a “midnight regulation” of the Biden era.
The rule “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,” he said at the time.
On Thursday, crypto policy leaders hailed Trump’s signing of the resolution eliminating the rule as a major milestone in the industry’s trajectory.
“Digital asset regulatory history was made in the U.S. today,” Amanda Tuminelli, Executive Director of crypto lobbying group, the DeFi Education Fund, said in a statement shared with Decrypt.
“President Trump’s signature is a critical signal change for the crypto industry: the U.S. has embraced a sensible, forward-thinking approach to digital assets,” it added.
Edited by Andrew Hayward
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