The United States Senate has voted 70-27 to overturn an IRS rule that would have imposed new tax reporting requirements on decentralised finance (DeFi) brokers.

The decision, backed by both parties, follows concerns that the rule was impractical for platforms that do not operate like traditional financial institutions. Critics, including the digital asset think tank Coin Centre, argued that enforcing such measures would be 'technologically unfeasible'.

The rule, introduced in December, aimed to broaden the definition of 'brokers' to include DeFi platforms, requiring them to report user data.

However, the resolution must still pass the House of Representatives before reaching President Trump, who is expected to sign it into legislation. If enacted, it would prevent the IRS from imposing similar rules in future, marking a significant victory for the cryptocurrency industry.

The Blockchain Association, representing firms like Coinbase and Kraken, welcomed the decision, saying it protects DeFi innovation from unnecessary restrictions.

The Senate's move also aligns with previous efforts to reverse SEC standards on digital assets. It could pave the way for broader cryptocurrency regulations, with stablecoin and market structure laws expected to be discussed next.