The U.S. Department of the Treasury and Internal Revenue Service (IRS) have announced new reporting requirements for decentralized finance (DeFi) brokers, sparking strong opposition from the crypto industry.
Under the finalized rules, DeFi brokers must report the gross proceeds from digital asset sales, aligning their obligations with traditional securities brokers. Digital asset owners engaging in DeFi transactions will receive reporting forms from their brokers, mirroring conventional financial practices.
Assistant Secretary for Tax Policy Aviva Aron-Dine defended the measure, stating it would streamline tax filing processes and promote compliance across asset classes. The Treasury Department emphasized that while no new taxes are being imposed, the rules aim to standardize reporting across traditional and digital assets.
Industry leaders have voiced strong criticism of the decision. Blockchain Association CEO Kirstin Smith characterized the timing of the announcement as a deliberate attempt to disadvantage the American crypto industry before new political leadership takes office. The organization plans to challenge the rules actively.
Jake Chervinksy, a prominent crypto lawyer, labeled the decision "unlawful" on social media platform X. He specifically highlighted concerns about the requirement for DeFi platforms to implement know-your-customer (KYC) protocols by 2027, suggesting the rule should face legal challenges or reversal by future administration.
The new reporting requirements mark another chapter in the ongoing dialogue between regulatory authorities and the crypto industry, highlighting tensions between government oversight and innovation in the digital asset space.