White House Supports Repeal of “Broker DeFi Rule”

The White House has expressed its support for a congressional resolution aimed at repealing the controversial “Broker DeFi Rule,” which critics argue unfairly impacts the cryptocurrency industry and decentralized finance (DeFi) platforms.

David Sacks, the White House cryptocurrency and artificial intelligence chief, confirmed the administration’s backing of the Congressional Review Act (CRA) resolution introduced by Senator Ted Cruz and Representative Mike Carey. Known as SJ Res. 3, the measure seeks to overturn an Internal Revenue Service (IRS) rule issued on December 30, 2024, that broadened the definition of “intermediary” to include software handling DeFi transactions.

This regulation mandates certain DeFi participants to report gross proceeds from cryptocurrency sales and other digital asset transactions, including detailed taxpayer information. The administration’s Statement of Administration Policy warns that this rule could significantly impact the digital asset ecosystem, raise privacy concerns, and impose a heavy compliance burden on U.S. DeFi companies.

The statement criticized the rule, labeling it a “midnight regulation” implemented in the last days of the previous administration, which could hinder American innovation and raise privacy issues regarding taxpayer information.

The resolution, if passed, would nullify the IRS rule. The White House indicated that if SJ Res. 3 reaches President Trump, his senior advisers would recommend signing it into law.

This is not investment advice.