Crypto In currencies, the priority of regulation on a global scale is taxation. trump Before he even took office, the US Internal Revenue Service finalized a controversial rule. SEC Chairman Gensler also drew criticism for increasing his power by appointing some anti-crypto senior officials like him to senior positions and strengthening their positions before Trump took office. So what do the new rules mean?
DeFi Crypto Taxation
US Internal Revenue Service DeFi puts their platform in the same class as regular brokers. This imposes some responsibilities on DeFi protocols, which will be considered as intermediary institutions. For example, these protocols, called DeFi brokers, will store and report information about user transactions like normal market brokers.
Their customers will be sent a Form 1099 and their earnings will be subject to taxes. Deputy Under Secretary for Tax Policy Aviva Aron-Dine said;
“These regulations will help ensure that all taxpayers follow the same rules and have access to the information they need to file their taxes accurately.
cryptocurrencies “Aligning tax reporting requirements for tax reporting with reporting for other entities will help close the tax gap while making filing easier and cheaper for compliant taxpayers.”
Centralization Effort
stands for decentralized finance DeFi It also allows for privacy. For example, although an external user can monitor Y amount of transactions made by X wallet, he cannot know the owner of X wallet. Nobody knows this, including the platform. However, with this regulation, information such as name and address of users who interact with DeFi protocols through the website interface will also have to be stored.
What about those who make transactions by interacting directly with the smart contract? Or users who will make transactions with fake information? The answer to the second question means requiring KYC on DeFi platforms. But there is no such rule?
The rule is expected to go into effect on or after Jan. 1, 2027, according to the filing. KYC requirement for DeFi platforms was first introduced by SBF and then FTX its founder had defrauded all US investors out of billions.
Bill Hughes, Consensys senior advisor and director of global regulatory affairs, said this “absurd” rule would run into trouble in both the courts and Congress and would be sued. This step, taken when Trump took office, will probably be parried in the coming months and will adorn the headlines as one of the good news of that day.
Disclaimer: The information contained in this article does not constitute investment advice. Investors should be aware that crypto currencies carry high volatility and therefore risk, and should carry out their transactions in line with their own research.
