U.S. lawmakers have decided to eliminate the Internal Revenue Service’s contentious requirement that would have compelled decentralized finance platforms to disclose user transactions.
The initiative to oppose the IRS DeFi broker rule garnered bipartisan backing, with the House of Representatives voting 292-132 in favor of its repeal on March 11. While all 132 dissenting votes came from Democrats, 76 members of that party joined Republicans in supporting the repeal.
This DeFi broker rule would have mandated decentralized exchanges and other DeFi platforms to submit transaction details, including user data and gross income from crypto sales, to the IRS.
Opponents of the rule contend that it imposed an excessive compliance burden on DeFi platforms and raised significant privacy issues related to the collection of taxpayer information.
According to Republican Representative Mike Carey, the regulation represented a “massive government overreach” that would have “invaded the privacy of tens of millions of Americans” and hindered a budding industry.
House Financial Services Committee Chairman French Hill has also voiced similar concerns, labeling the rule as “a clear example of government overreach” that could drive digital asset innovation abroad.
The House vote followed the Senate’s action on March 4, where legislators also aimed to overturn the rule with a 70-27 majority. Earlier, on February 26, the House had moved forward with a resolution to repeal the regulation.
Since both congressional chambers have voted in favor of the repeal, the resolution will return to the Senate for a final decision before it reaches President Donald Trump.
The White House has already indicated its support for the repeal, suggesting that it is likely to be enacted into law.