EU Crypto Tax Rules Focus on Compliance While Leaving DeFi Out

The European Union has rolled out new crypto tax regulations aimed at ensuring compliance, particularly targeting traditional intermediaries like custodians and exchanges. As discussed by Colby Mangels, a previous advisor to the OECD, these rules demand specific reporting from these entities while currently excluding decentralized finance (DeFi) platforms.

Mangels highlighted that while DeFi platforms are not included in the new tax framework, this may soon change. With increasing scrutiny from tax authorities employing Anti-Money Laundering frameworks, the classification of DeFi as virtual asset service providers is a concern.

“The framework has its sights set on enforceable standards, monitoring DeFi’s potential classification in the future.” (Translation: “The framework has its sights set on enforceable standards, monitoring DeFi’s potential classification in the future.”)

In Japan, Bitcoin DeFi Tools are Taking Shape

Animoca Brands Japan has teamed up with Rootstock Labs to introduce Bitcoin DeFi solutions geared towards corporate treasury management.

This collaboration will adapt Rootstock’s offerings for Japanese companies, allowing efficient management of Bitcoin assets using tools secured through Bitcoin’s proof-of-work.

U.S. Senate Reviews Crypto Market Structure Bill

In the U.S., senators are considering potential amendments to the Digital Commodity Intermediaries Act (DCIA) amidst ongoing discussions about DeFi’s role within the proposed legislative changes.

The bill’s goal is to clarify authority between regulatory bodies, but there are concerns regarding how it may affect DeFi’s operation.

DePIN Sector Flourishing

According to a report by Messari, decentralized physical infrastructure networks (DePIN) have surged into a $10 billion industry, showing resilience in revenue against the slump faced by many tokens.

Bitcoin and Block Space Debate Reignited

The launch of Citrea’s Bitcoin zero-knowledge rollup has sparked renewed conversations regarding the use of Bitcoin block space, addressing its complexity in supporting DeFi while managing bandwidth.

Conclusion

Most cryptocurrencies are facing downward trends, with particular tokens recording significant losses. As the DeFi landscape continues to evolve alongside regulatory frameworks, insights and developments will be closely monitored.