David Sacks, the AI and crypto czar in the Trump administration, said the White House would support congressional efforts to rescind the Internal Revenue Service (IRS) decentralized finance (DeFi) broker rule.
In a March 4 X post, Sacks said the administration supported Texas Senator Ted Cruz’s and Ohio Representative Mike Carey’s resolutions under the Congressional Review Act to repeal a regulatory rule that expands the definition of a “broker” to include software providers that enable access to DeFi protocols. According to the AI and crypto czar, Donald Trump’s senior advisers would recommend he sign joint resolution S.J. Res. 3 into law if it were sent to the US President’s desk by Congress.
“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 claimed in a March 4 statement.
March 4 statement in support of rescinding DeFi broker rule. Source: David Sacks
The rule, released by the IRS in December 2024 before Trump took office, triggered an immediate backlash from many in the crypto industry claiming the policy would move companies offshore or otherwise stymie innovation. However, the rule is not scheduled to be implemented until 2027.
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Under the IRS policy, if a DeFi platform is involved in facilitating the exchange or sale of digital assets and exercises sufficient control or influence over the transaction process, it could qualify as a broker and be subject to additional reporting requirements. The government body estimated the new rule could affect between 650 and 875 DeFi brokers, who would need to begin collecting data in 2026.
The potential change in IRS policy is just one of many laws the Republican-controlled Senate, House of Representatives, and executive branch have proposed since taking office in January. Trump has signed several executive orders favorable to the industry and announced plans to host a crypto summit at the White House on March 7.
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