IRS to back down on controversial broker rule
As per a July 10 report by Bloomberg, the Treasury Department cut a proposed set of crypto reporting rules after Congress voted to repeal them earlier in the year.
The regulation (TD 10021, RIN 1545-BR39), outlined under Section 6045, specified how decentralized crypto exchanges, or DeFi exchanges, would report the customer transaction information to the US government for tax purposes.
This action follows Congress's earlier repeal, through the Congressional Review Act, which overturned the revised IRS rule that broadened the definition of 'broker' to include DeFi platforms.
Approved last December 2024, the rule would have treated both centralized and decentralized crypto platforms as brokers who must report customer trades to help fight tax evasion.
It had been created by the enforcement provisions of the 2021 Infrastructure Investment and Jobs Act. DeFi proponents countered that DeFi platforms have no way to capture or verify user information so compliance is not practical and is an unreasonable burden. Industry groups lobbied against the expansion, arguing it would snuff out innovation and send projects overseas.
The repeal was passed by both the Senate (70–28) and the House, an indication of strong bipartisan opposition. On April 11, President Donald Trump signed a bill reversing the expanded IRS crypto brokers which otherwise would have been a burden on developers and front-end teams.
The official withdrawal of the rule by way of the Department of the Treasury draws a line in the sand, finally recognizing that Congress intended for broker reporting to apply specifically to custodial, intermediary exchanges.
It does not preclude future rulemaking that might be specifically adapted to non‑custodial and decentralized entities. For now, the crypto industry sees this as a win.
IRS to back down on controversial broker rule first appeared on TheStreet on Jul 10, 2025
This story was originally reported by TheStreet on Jul 10, 2025, where it first appeared.
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