U.S. Senate Advances Bill to Overturn IRS Reporting Rules for DeFi Platforms

According to Foresight News, the U.S. Senate has passed the Congressional Review Act (CRA) with a significant majority of 70-28 votes, marking the second approval of the bill aimed at overturning the Internal Revenue Service's (IRS) reporting requirements for decentralized finance (DeFi) platforms. If enacted, this legislation would exempt DeFi protocols from the obligation to report user information in the same manner as traditional brokers. Previously, the IRS mandated that DeFi brokers report the total proceeds from digital asset sales and provide customers with Form 1099, which includes collecting user transaction details such as names and addresses. This move by the Senate seeks to alleviate the reporting burden on DeFi platforms, aligning them differently from conventional brokerage firms.