Trump signs resolution to repeal the DeFi protocol tax rule

The rule was passed toward the end of Joe Biden’s presidential term

11.04.2025 - 09:40

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What’s new? Donald Trump has signed a resolution to repeal a controversial cryptocurrency tax rule passed toward the end of President Joe Biden’s term. It required decentralized finance (DeFi) participants to act like traditional securities brokers, namely to collect and report user trading data to the Internal Revenue Service (IRS).

Material by The Block

What else is known? The rule also required DeFi developers to issue Form 1099 tax returns to customers to report non-employment income, such as gambling winnings, rent, and royalties.

According to a statement from the Treasury Department, the rule applied to front-end service providers who interact directly with customers. That means it was aimed at organizations that operate the main website that provides access to the decentralized protocol, not the protocol itself.

Earlier this year, Republicans Senator Ted Cruz of Texas and Representative Mike Carey of Ohio introduced a joint resolution to repeal the rule, which passed in December. In March, the House and Senate supported repealing the rule, including with input from Democrats, and Senate Minority Leader Chuck Schumer in particular. However, most of the support came from Republicans.

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“By repealing this misguided rule, President Trump and Congress have given the IRS an opportunity to return its focus to the duties and obligations it already owes to American taxpayers instead of creating a new series of bureaucratic hurdles,” said Mike Carey.

Amanda Tuminelli, Executive Director of crypto lobbying organization DeFi Education Fund, also commented on the latest changes:

“The DeFi Education Fund commends all members of Congress who supported this resolution, recognizing the importance of protecting software developers and promoting the development of decentralized technologies. President Trump’s signature is a critical signal change for the crypto industry: the United States has embraced a sensible, forward-thinking approach to digital assets.”

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