In a groundbreaking move, U.S. President Donald Trump has officially repealed a controversial IRS rule targeting decentralized finance (DeFi) protocols. The rule, originally set to take effect in 2027, would have forced DeFi platforms to report user transactions and gross crypto sales to the Internal Revenue Service, including personal taxpayer data.

The measure, widely seen as a threat to blockchain innovation and user privacy, was overturned through a congressional resolution that Trump signed on April 10. It marks the first crypto-specific bill ever signed into law in U.S. history. Backed by Representative Mike Carey, the bill quickly passed both chambers of Congress after intense debate over its implications.

Critics argued that the IRS DeFi broker rule was an overreach, with potential to paralyze innovation, flood the IRS with unmanageable data, and violate the privacy of American crypto users. Meanwhile, some Democrats, like Rep. Lloyd Doggett, warned its repeal could create a tax loophole for the wealthy.

Crypto leaders celebrated the repeal. Kristin Smith, CEO of the Blockchain Association, said the industry could “breathe again,” calling the rule a “sledgehammer” to American innovation. Her organization previously sued the IRS and Treasury, claiming the rule was unconstitutional.

Under Trump’s leadership, the SEC has also eased its crackdown on crypto, dropping enforcement cases and launching consultations on fair regulation. The administration’s friendlier stance toward digital assets could signal a dramatic shift in U.S. crypto policy.

As the crypto world cheers this historic win, the industry now looks ahead to shaping regulations that protect innovation without crushing it. This repeal marks a defining moment for DeFi in America’s regulatory future.