US Treasury & IRS Repeal Crypto Broker Tax Reporting Rule for DeFi Platforms

The U.S. Treasury Department and the Internal Revenue Service have officially revoked a controversial crypto broker tax regulation that targeted decentralized platforms and non-custodial service providers. The rule, finalized in December 2024, would have expanded tax reporting obligations under Section 6045 of the tax code, imposing unrealistic data collection requirements on DeFi protocols.

Congressional intervention via the Congressional Review Act, spearheaded by Senator Ted Cruz, led to the rule's repeal in April 2025. The Treasury's confirmation of its removal from the Code of Federal Regulations marks a significant victory for crypto advocates who argued the mandate was technologically unworkable for decentralized systems.

The debate over tax transparency versus technical feasibility in crypto markets has spanned years. Industry groups like Coin Center and the Blockchain Association consistently opposed the rule, emphasizing that decentralized networks lack the infrastructure to collect personal user data. This repeal preserves the original language of the tax code while lawmakers prepare for a July 16 hearing on modernizing digital asset tax policy.