The Blockchain Association, a pro-crypto lobby group, says the U.S. Treasury Department’s new proposed crypto regulations will destroy the domestic decentralized finance (DeFi) industry.
In August, the Treasury Department and the Internal Revenue Service (IRS) rolled out a new proposal that would establish new reporting requirements for “crypto brokers.”
Crypto broker is a term that regulators use to refer to trading platforms, digital asset payment processors, certain providers of digital asset-hosted wallets, and people who regularly offer to exchange crypto assets they have created or issued.
The proposal would require crypto brokers to report new information to tax authorities about the sales and transfers of their users’ crypto assets.
On Monday, the Blockchain Association submitted a comment on the Treasury Department’s proposed new rules.
Marisa Tashman Coppel, senior advisor to the lobby group, argues the proposal exceeds the statutory authority of the supervisor.
“The proposal reaches parties whose only means of compliance would be to give up the decentralized technology that makes them unique.
It will drive US-based decentralized projects abroad or even disappear altogether. And would require centralization where none exists.
The definition of ‘broker’ in the proposal should be limited to centralized entities that can collect such information. This is what Congress meant when it first put forward the clarified definition two years ago. And how broker reporting rules have functioned historically.”
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