Trump administration backs repeal of DeFi broker rule

David Sacks, the AI and crypto policy advisor in the Trump administration, said the White House supports congressional efforts to overturn an IRS rule that broadens the definition of a "broker" to include DeFi software providers.

On March 4, Sacks posted on X that the administration backs resolutions introduced by Senator Ted Cruz and Representative Mike Carey to repeal the IRS rule under the Congressional Review Act.

He stated that senior advisers would recommend President Donald Trump sign the resolution into law if it reaches his desk.

“This rule, issued as a midnight regulation in the final days of the previous administration, would stifle American innovation and raise privacy concerns over the sharing of taxpayers’ personal information, while imposing an unprecedented compliance burden on American DeFi companies,” officials from the Office of Management and Budget said in a statement.

The IRS introduced the rule in December 2024, before Trump took office, drawing immediate criticism from the crypto industry.

Opponents argue that the regulation would push companies out of the U.S. and negatively impact the sector.

The rule, set to take effect in 2027, would require certain DeFi platforms that facilitate digital asset transactions and influence the process to report customer data.

According to the IRS, between 650 and 875 DeFi brokers would be subject to compliance requirements starting in 2026.

The proposed repeal is part of broader legislative efforts by the Republican-controlled Congress and executive branch.

Since taking office in January, Trump has signed executive orders addressing industry concerns.

He has also announced a White House crypto summit scheduled for March 7, where regulatory issues and policies are expected to be discussed.