Crypto industry groups are suing the IRS over the broker reporting rule

Three crypto industry groups — the DeFi Education Foundation, the Blockchain Association and the Texas Blockchain Council — are suing the Internal Revenue Service to block it. new rules which requires decentralized finance (DeFi) institutions to report customer data.

IRS is about to finalize crypto tax rules As part of the Biden Administration’s Infrastructure Investment and Jobs Act. The IRS says these new rules should help “close the information gap related to digital assets.”

A lawsuiton the other hand, it argues that this approach would overburden “DeFi trading fronts” – essentially online platforms that allow users to access cryptocurrency protocols but do not themselves “transact effectively”. The lawsuit opposes defining these fronts as brokers, in part because “there is no broker-like entity involved in a decentralized transaction.”

Marisa Koppel, legal head of the Blockchain Association, said this statement said the new rules were a “violation of the privacy rights of individuals using decentralized technology” and would also “push all this emerging technology overboard.”