Trump vs. IRS: The Crypto Showdown You Didn’t See Coming!

by
  • Trump signs bill repealing IRS crypto broker rule, a win for DeFi. 🎉
  • New law prevents future IRS crypto rules without Congressional approval. 🚫💸

President Donald Trump, in a move that shocked absolutely no one who’s been paying attention, has signed a bill into law that cancels a controversial IRS rule affecting the cryptocurrency industry. Digital asset supporters are popping champagne 🍾 because this is a major victory for users of decentralized finance platforms, aka DeFi. Because who doesn’t love a little chaos in their financial system?

Trump Signs Bill to Block IRS DeFi Tax Regulation

The IRS, in their infinite wisdom, decided to redefine what constitutes a broker by including decentralized crypto exchanges. Because, you know, why not? These platforms, where people can conduct direct transactions without traditional mediators, would’ve had to submit user tax data to the IRS. But let’s be real, DeFi systems can’t even get their act together to collect personal data, so this rule was DOA. 💀

Even though the rule wasn’t set to take effect until 2026, it sparked outrage faster than a cat video on the internet. The cryptocurrency industry called it overly broad and impossible to execute. Because, surprise, DeFi systems don’t have the capabilities to comply with reporting obligations. Who could’ve guessed? 🤷‍♂️

The IRS finalized the rule just as the Biden administration was wrapping up in December 2024. The public announcement of taxes on DeFi systems triggered a backlash from cryptocurrency developers, investors, and privacy advocates. Because nothing says “freedom” like the IRS breathing down your neck. 🇺🇸

Congress, in a rare moment of actually doing something, stepped in. The House and Senate passed a bill to repeal the IRS rule in March 2025. Thanks to the Congressional Review Act, they can abolish recently implemented federal rules with minimal approval. After both chambers approved the repeal, it was sent to President Trump for his signature. Because, of course, it was. 🖋️

New Law Bans IRS from Targeting DeFi Without Congress

On April 11, 2025, President Trump officially signed the bill into law. With a stroke of his pen, he blocked the updated broker rule by the IRS and declared it permanently exempt from reinstatement without Congressional approval. Because nothing says “checks and balances” like a good ol’ Congressional smackdown. 👊

Supporters of the decision hailed it as a victory for freedom, innovation, and privacy. Representative Mike Carey argued that the proposed requirement would’ve created an excessive amount of paperwork, overwhelming the IRS during tax season. Because, you know, the IRS isn’t already drowning in paperwork. 📚

Carey also emphasized that the IRS should focus on its existing responsibilities instead of creating new, burdensome rules. He thanked President Trump for his defense of the industry and praised Crypto Czar Sacks for his groundwork on this legislation. Because every good story needs a hero. 🦸‍♂️

The rule originated from the Infrastructure Investment and Jobs Act of 2021, which ordered the IRS and Treasury Department to create protocols for digital asset disclosure. Critics argued that the IRS exceeded its authorized scope by including self-custodial wallets and noncustodial software developers in their regulatory scope. Because, of course, they did. 🙄

With his signature, President Trump established support for digital assets and set a positive precedent in the industry. This new legislation forbids any future administration from reinstating similar IRS reporting rules without completing full legislative procedures. Because nothing says “democracy” like a good ol’ bureaucratic battle. 🏛️

Ultimately, this decision shifts US government policy toward cryptocurrency regulation into a new direction. The new legislation safeguards innovation, decentralized infrastructure, and user information privacy. Because, in the end, it’s all about the Benjamins. 💵

 

Read More

2025-04-11 21:12