The US Internal Revenue Service (IRS) announced new rules on December 27 defining some decentralized finance (DeFi) agreements as brokers and requiring customer identification (KYC) requirements, sparking strong opposition from the crypto industry. The rules are expected to affect up to 875 DeFi brokers and 2.6 million taxpayers. Criticized by legal experts for allegedly overstepping its authority and potentially violating constitutional rights, Alexander Grieve, vice president of Paradigm, called on the new “pro-crypto Congress” to repeal the rules through the Congressional Review Act (CRA). The Blockchain Institute called the rules “a last-ditch effort to push the US crypto industry overseas” and said it would take action to counter them. As previously reported, the IRS requires “DeFi brokers” to collect user transaction information.
