In a major win for the cryptocurrency and decentralized finance (DeFi) space, U.S. President Donald Trump has officially repealed a Biden-era IRS crypto tax reporting rule that had been widely criticised across the digital asset industry. The decision, enacted through the Congressional Review Act, marks a pivotal shift in how the U.S. plans to regulate blockchain technologies and decentralized platforms.
The now-defunct rule, which was tied to the 2021 Infrastructure Investment and Jobs Act, sought to classify DeFi protocols as “brokers,” effectively lumping them in with centralized crypto exchanges like Coinbase and Kraken. This would have forced DeFi platforms—many of which are peer-to-peer and don’t collect user data—to track and report detailed transaction information to the IRS.
Industry experts and blockchain advocacy groups were quick to raise red flags. They argued that the rule was “unworkable” for decentralized protocols that are built specifically to remove middlemen and operate without Know-Your-Customer (KYC) processes. Critics warned it would stifle U.S. crypto innovation and drive developers and entrepreneurs offshore.
The IRS finalized the rule in late 2024, but after intense pushback, Congress voted in March 2025 to repeal it—citing concerns over its incompatibility with decentralized technologies and the potential threat it posed to U.S. competitiveness in the global crypto economy.
President Trump, who has dubbed himself the “crypto president,” has been vocal in his support for digital asset innovation. He called the repeal a win for American leadership in blockchain and Web3 technologies. In line with his pro-crypto stance, he also launched a federal cryptocurrency working group and signed an executive order to establish a national bitcoin reserve earlier this year.
With this repeal, the U.S. sends a strong signal to the global crypto community: decentralized innovation is not only welcome but encouraged. It marks a turning point in the evolving conversation around crypto regulation, DeFi compliance, and the future of blockchain policy in America.
