Washington makes a strong move towards crypto
Politics and tech often clash. Crypto just won a big fight in Washington. The IRS rule on digital asset brokers is now gone. It was set to start in 2025. The Senate voted to kill it. Donald Trump is likely to sign it. This ends a rule most people did not want.
A US Senator showed strong support for crypto. The IRS rule seemed flawed from the start. It asked all those who sold digital assets to report "gross proceeds". This sounds okay at first. But the rule went too far. It covered DeFi protocols. It also covered crypto developers. Even non-custodial apps were included.
Imagine a smart contract filling out tax forms. That is absurd. The crypto industry quickly protested. They said it was not practical. It was also legally unclear. The rule was even seen as harmful.
Consider a small DeFi platform. It lets people trade tokens. This platform would have to track and report every trade. This would be very hard to do. Many worry it could hurt innovation. It might even drive crypto businesses out of the US.
Republicans used the Congressional Review Act to fight the rule. This tool is rarely used. The repeal passed both the House and Senate. What is surprising is the bipartisan support. Democrats and Republicans agreed. They saw the rule as a threat to American innovation. Crypto united a divided political class for once.
Donald Trump is expected to sign the repeal. This will send a clear message to the crypto world. He is positioning himself as a defender of innovation. This is against overzealous government. The crypto world is relieved by the Senate vote. There is even some optimism. America seems ready to embrace decentralization.
One chapter is closed. But the story is not over. The repeal avoids a regulatory mess. But it leaves a gap. Clear rules are still needed. These rules should treat custodial and non-custodial players differently. Crypto lawmakers now have a challenge. Donald Trump does too. His administration might soon hold a lot of Bitcoin.
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