House Passes Vote to Overturn Biden-Era DeFi Broker Rule

The U. S. House of Representatives voted 292-132 Tuesday to retract an IRS law that would have required decentralized financing platforms to gather and report tax info, a critical republican rebuke of crypto regulations finalized in the waning days of the Biden administration.

Seats came in with 76 Congressional Democrats crossing the floor, backing reviewers who argued the law would have imposed essentially difficult compliance requirements on DeFi protocols.

This rule is both “unfair” and “unworkable”, House Ways and Means Committee Chairman Jason Smith (R-MO ) argued on the floor debate. ” There are actual queries that the rule can always also get administered”.

” Le systems do certainly and cannot even collect the information from people needed to implement this concept. Their software always controls the modern property”, Smith said in a ready speech delivered to the House.

Representative Mike Carey (R-OH) submitted the mutual decision on January 21, 2025. An upgrade from the Office of the Speaker confirms the vote count.

The House ballot follows similar bipartisan support in the Senate next year, tapering off earlier conversations in the House from soon February that the law contained “burdensome needs”.

The IRS regulation would have expanded the definition of “broker” to include DeFi platforms, requiring them to file Form 1099-DA tax documents despite most protocols lacking the technical ability to collect user information.

A supermajority vote in this direction shows an “encouraging sign of a new era for crypto in Washington”, Blockchain Association CEO Kristin Smith said in a statement.

Democrats opposing the measure raised concerns about tax compliance and revenue loss. Texas Democrat Lloyd Doggett (D-TX ) characterized the resolution as a” special interest legislation” that could be “exploited by wealthy tax cheats, drug traffickers and terrorist financiers”.

The resolution invoked the Congressional Review Act, which allows Congress to overturn newly finalized federal regulations.

If signed into law, it would prevent the IRS from issuing similar rules in the future without explicit congressional authorization.

The joint resolution now returns to the Senate for another vote due to budget rules before heading to President Trump’s desk, where it’s expected to receive his signature.