Key Points:
- The White House has announced support for S.J. Res. 3, a resolution introduced by Sen. Ted Cruz and Rep. Mike Carey to rescind the IRS “Broker DeFi Rule.”
- The rule, issued on December 30, 2024, expands the definition of “broker” to include software that provides access to decentralized finance (DeFi) protocols.
- The administration argues that the rule threatens innovation, creates privacy concerns, and increases compliance burdens on DeFi companies.
The White House has formally expressed its support for a congressional resolution aimed at overturning a controversial IRS regulation on digital asset reporting.
In a Statement of Administration Policy issued on March 4, 2025, the administration endorsed S.J. Res. 3, a joint resolution introduced by Senator Ted Cruz (R-TX) and Representative Mike Carey (R-OH).
The White House is pleased to announce its support for the CRA introduced by @SenTedCruz and @RepMikeCarey to rescind the so-called Broker DeFi Rule, an 11th hour attack on the crypto community by the Biden administration. pic.twitter.com/T7Hxasb4aC
— David Sacks (@davidsacks47) March 4, 2025
The resolution seeks to invalidate the IRS rule requiring certain DeFi participants to report gross proceeds from cryptocurrency transactions.
The IRS rule, which was finalized on December 30, 2024, expanded the definition of “broker” to include software that allows access to decentralized finance (DeFi) protocols.
Critics argue that this change would force DeFi platforms and developers to collect and report financial data on users, even if they do not directly facilitate transactions. The rule also raises privacy concerns, as it would require DeFi participants to report details on digital asset transactions and taxpayer information.
The administration described the regulation as a “midnight rule” issued in the final days of the previous administration, arguing that it would stifle financial innovation, compromise user privacy, and impose excessive compliance burdens on DeFi companies.
The White House stated that supporting S.J. Res. 3 aligns with its commitment to fostering regulatory policies that encourage innovation, create jobs, and promote economic growth.
If passed by Congress and presented to the President, the White House has confirmed that senior advisors would recommend he sign the resolution into law, effectively nullifying the IRS rule.
The administration’s stance marks a major policy shift on crypto regulation, reinforcing its support for DeFi innovation and privacy protections in the U.S. financial sector.
