Emre Yumlu 
The Blockchain Association, representing 76 crypto firms, is urging Congress to repeal the IRS’s DeFi broker rule. They argue that the rule threatens US crypto innovation and imposes an unfair burden on blockchain firms.
Blockchain Association Calls on Congress to Repeal DeFi Rule
The Blockchain Association, representing 76 crypto organizations, has urged congressional leaders to support Senator Ted Cruz in repealing the anti-crypto regulation finalized during the final days of former President Joe Biden’s administration.
On February 19, the Blockchain Association sent a letter to Senate Majority Leader John Thune, Senate Minority Leader Chuck Schumer, House Speaker Mike Johnson, and House Minority Leader Hakeem Jeffries, calling for the repeal of the IRS’s decentralized finance (DeFi) broker rule.
The letter was signed by major crypto organizations, including 0x Labs, a16z Crypto (Andreessen Horowitz’s crypto division), Aptos Labs, Crypto.com, Grayscale, Dapper Labs, and Ava Labs.
Crypto Firms Criticize Biden-Era IRS Regulation
The letter advocates supporting Senator Ted Cruz’s Congressional Review Act (CRA) resolution, S.J.Res. 3, which seeks to expand the definition of a “broker” under US law to include software providers that enable access to DeFi protocols.
Set to be implemented in 2027, the DeFi broker rule would subject decentralized exchanges to the same reporting requirements as traditional brokers.
The IRS disclosed on December 27, 2024, that if implemented, the DeFi broker rules could affect up to 875 DeFi brokers in the US.
Industry Concerned About Stifled Innovation
The Blockchain Association argued that the rule imposes severe and unjustified burdens on American DeFi companies, threatens innovation in the digital asset sector, and weakens US competitiveness in financial technology:
“Under the rule, software companies that never take custody or control of users’ assets will be required to radically rebuild their services. This would unnecessarily involve collecting personal identifying information and transaction details to report to the government.”
In addition to the compliance burden, the rule unfairly targets US-based crypto companies and could “cripple DeFi innovation” in the US.
The Blockchain Association described the rule as a “midnight regulation” and stated that such far-reaching decisions should be made by Congress. The letter called on Congress to support the CRA resolution to foster DeFi innovation, economic growth, job creation, and financial inclusion.
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