President Donald Trump has officially repealed a controversial cryptocurrency tax rule finalized in the previous administration’s last days. The rule, introduced by the IRS in December, aimed to impose strict reporting requirements on custodial brokers, including entities involved in decentralized finance.
Under the regulation, platforms like regular financial brokers need to gather extensive user information while producing Form 1099s. These new regulations required website providers that enable decentralized protocol access to maintain user data records for reporting purposes, resulting in industry-wide concern.
The repeal initiative commenced under Senator Ted Cruz and Representative Mike Carey, who presented their joint resolution this year. President Trump finally approved the resolution that Congress had submitted and signed it into law during Thursday’s ceremony.
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Representative Carey, who was present at the signing, described the move as a significant win for innovation. He said the rule created unnecessary hurdles in regulatory policy for an industry that needs clarity, not confusion.
Crypto Advocates Call the Repeal a Turning Point for Decentralized Finance
Industry leaders applauded the decision, saying it marks a shift in how the U.S. approaches digital assets. Amanda Tuminelli, Executive Director of the DeFi Education Fund, emphasized that the repeal protects software developers and recognizes the unique structure of decentralized networks.
According to the U.S. Treasury, the rule applied to front-end service providers that interacted directly with users. Critics claimed these providers do not have access to needed data for IRS compliance, which makes the rule both unrealistic and destructive.
The crypto community warned that enforcing such standards could damage development, limit user privacy, and expose developers to regulatory risks they are not equipped to handle. Due to the repeal, new legislation with contemporary practices and practicality now has the opportunity to develop.
Senate Minority Leader Chuck Schumer joined other members from both sides of Congress to show that Washington institutions recognize the need for measured cryptocurrency regulations.
Conclusion
The IRS crypto broker rule is no longer effective with President Trump’s signature. The decision reflects a policy shift that supports innovation while seeking regulatory clarity, and it has been welcomed across the digital asset ecosystem.
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