The House of Representatives voted overwhelmingly to rollback a last-minute cryptocurrency rule published by the Department of Treasury in the waning days of the Biden Administration that would cripple American digital asset leadership, stifle innovation, and burden American entrepreneurs. H.J.Res.25, introduced by Ways and Means member Representative Mike Carey (OH-15), repeals the Internal Revenue Service’s (IRS) “DeFi Broker Rule” which would devastate the American digital asset industry and American innovation by requiring those participating on decentralized finance exchanges to satisfy unworkable and overly burdensome reporting requirements – including collecting sensitive taxpayer information. According to IRS estimates, the rule would produce at least 8 billion new pieces of paperwork for taxpayers to submit to the agency and for IRS employees to collect and analyze.

On the floor of the U.S. House of Representatives, Ways and Means Committee Chairman Jason Smith (MO-08) described the crushing impact of the Biden-IRS “DeFi Broker rule”:

“Under President Biden, the IRS traded congressional intent for a politically-motivated mandate. The Biden Administration made no secret of its opposition to digital assets and America’s leadership in this booming industry. Bureaucrats weaponized every tool in the toolbox, including finalizing this rule at the 11th hour, crippling the digital asset industry and threatening American leadership and innovation in the process. Approximately 1 in 4 Americans own cryptocurrency. This rule puts a huge burden on these regular folks and could discourage participation in the digital asset market altogether .”

When the Ways and Means Committee considered the legislation earlier this year, every single committee Democrat voted against the bill. However, on the House floor 76 Democrats voted in favor of the bill

Background on H.J.Res.25 – Disapproving of Biden IRS “DeFi Broker Rule”
Disapproves, under the Congressional Review Act, of a last-minute Biden Administration regulation that expands federal reporting requirements for those involved in decentralized digital asset transactions.

• In December 2024, the Biden Administration released a new rule requiring decentralized finance (DeFi) brokers to file a Form 1099-DA and subject DeFi brokers to the same reporting rules as brokers for securities and operators of custodial digital asset trading platforms – despite the systematic differences between the two.
• Unlike securities brokers or centralized brokers of custodial digital assets – which operate more like banks – DeFi brokers are not centralized, do not collect the information needed to implement this rule, and do not act as a true third-party intermediary like more traditional securities brokers.
• Describing the rule, former IRS Commissioner Charles Rettig said these new crypto regulations would “overwhelm the agency and have little or no value to effective and efficient tax administration.”
• The joint resolution effectively repeals the rule submitted by the Treasury relating to “Gross Proceeds Reporting by Brokers That Regularly Provide Services Effectuating Digital Asset Sales.”
• The joint resolution would also wipe the slate clean for Congress to enact the Trump Administration’s desired policy related to DeFi brokers.

Click here for a fact sheet on the bill