The United States Senate will vote this week on a resolution seeking to overturn the Internal Revenue Service’s crypto reporting rule, which industry players argue threatens the decentralized finance sector. Reports that U.S. senators were looking to overturn the IRS rule emerged at the end of February.
In addition to the IRS crypto rule, lawmakers are also targeting the Consumer Financial Protection Bureau rule, which focuses on digital payment applications, for removal. Senator Ted Cruz recently introduced the resolution against the IRS rule under the Congressional Review Act, while Senator Pete Ricketts introduced a separate resolution to challenge the CFPB rule.
The CRA provides an additional layer of congressional oversight, allowing lawmakers and the comptroller general of the Government Accountability Office to review federal agency rules before they take effect.
IRS’ broker rule sparks industry backlash
The IRS’ broker rule, announced in December 2024, mandates that decentralized crypto projects disclose operational details and tax information. The crypto industry reacted negatively to the regulation, arguing that its requirements would stifle innovation in the U.S.
Meanwhile, the CFPB rule, introduced on Jan. 10, 2025, proposes expanding consumer protections to the digital asset space. It includes stablecoins and other crypto payment options, aiming to apply the Electronic Fund Transfer Act and Regulation E guidelines to the digital payment ecosystem.
Analysts have also criticized the CFPB rule, warning that it could negatively impact tech companies offering crypto wallets and payment apps. If the Senate votes to repeal the rules, both the IRS reporting requirements and the CFPB payment application rule could be nullified. The push to remove agency regulations aligns with a broader effort by the new administration under President Donald Trump to shift away from the restrictive stance on crypto seen under former President Joe Biden’s government.
On March 3, a day after Trump’s announcement around a strategic crypto reserve for the U.S., House Representatives announced a new bipartisan crypto support initiative. House Republican Tom Emmer and Democrat Ritchie Torres lead the Congressional Crypto Caucus effort.