Consensys expresses worries regarding IRS’s crypto rulemaking proposal
Consensys, a blockchain firm known for its software development of MetaMask and Infura, has expressed its concerns about the proposed crypto regulations by the IRS. The company emphasized the importance of precision and careful consideration in designing reporting requirements for digital-asset brokers. In its blog post on December 21, Consensys highlighted the need for the final regulations to reflect the complexities of digital-asset platforms and ensure the continued growth of the industry.
Consensys pointed out that if the proposed regulations are finalized without changes, it would impose a complex regulatory scheme on software developers and others in a rapidly expanding industry with unique technical and operational characteristics. The company also criticized the adequacy of the analysis in the notice of proposed rule-making, stating that regulated parties may find it challenging to comply with the proposed amendments.
As a solution, Consensys suggested a phased-in approach for particularly challenging aspects of the regulations and a delay in implementation deadlines. The IRS introduced the proposed regulations in September, primarily focusing on expanding reporting requirements to cover crypto transactions. Under the proposed regulations, brokers would have new responsibilities, including submitting information returns and providing payee statements for designated crypto dispositions on behalf of their customers, which would require the introduction of a new IRS form.
The regulations are expected to take effect in 2026, with applicability to transactions in 2025. Specific provisions will become effective in 2027 for transactions occurring in 2026. It is essential for the IRS to carefully consider the concerns raised by Consensys to ensure a balanced and effective regulatory framework for the crypto industry.
