Blockchain Association Says Proposed Broker Rule Will Drive US-Based DeFi out of Existence
The Blockchain Association, a pro-crypto lobbying group, says new proposed crypto regulations from the U.S. Department of the Treasury will destroy the domestic decentralized finance (DeFi) sector.
In August, the Treasury Department and the Internal Revenue Service (IRS) rolled out a new proposal that would lay out new reporting requirements for “crypto brokers.”
Crypto broker is a term the regulators use to refer to trading platforms, digital asset payment processors, certain digital asset-hosted wallet providers and people who regularly offer to redeem crypto assets that they created or issued.
The proposal would require crypto brokers to report new information to tax authorities regarding their users’ crypto assets sales and transfers.
On Monday, the Blockchain Association filed a comment regarding the Treasury’s proposed new rules.
Marisa Tashman Coppel, the lobbying group’s senior counsel, argues the proposal exceeds the regulator’s statutory authority.
“The proposal sweeps in parties whose only means of compliance would be to abandon the decentralized technology that makes them unique.
It will drive US-based decentralized projects abroad or out of existence, full stop. And would require centralization where none exists.
The Proposal’s definition of ‘broker’ should be limited to centralized entities, who can collect such information. This is what Congress intended when it initially set forth the clarified definition two years ago. And how broker reporting rules have functioned historically.”
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