Crypto Exchange Delays DeFi Rules Amid Regulatory Uncertainty

US House Kills IRS DeFi Broker Rule, Solana Won't Cut 80% Inflation Rate

The US House of Representatives has voted to repeal the Internal Revenue Service's (IRS) proposed rule requiring digital asset brokers to report client transactions and maintain records, a move that could impact the decentralized finance (DeFi) space.

The IRS's DeFi Broker Rule, which was introduced in May, aimed to clarify the tax obligations of digital asset brokers, including those involved in DeFi transactions. The rule would have required brokers to report client transactions and maintain records of these transactions, similar to traditional financial institutions.

However, the rule faced opposition from many in the DeFi community, who argued that it would stifle innovation and create unnecessary regulatory hurdles. The Solana Foundation, a non-profit organization that supports the development of the Solana blockchain, was particularly vocal in its opposition to the rule.

In a statement, the Solana Foundation said that the IRS's DeFi Broker Rule would have had a devastating impact on the DeFi ecosystem, potentially cutting inflation rates by 80%. The foundation argued that the rule would have led to increased regulatory uncertainty, making it more difficult for DeFi projects to attract investors and maintain liquidity.

The US House's vote to repeal the rule is seen as a victory for the DeFi community, which can now continue to operate without the burden of the proposed regulations. However, the debate over the role of the IRS in regulating DeFi is far from over, and the issue is likely to continue to be a topic of discussion in the coming months and years.