PANews reported on December 30 that according to a tweet by Michele Korver, head of regulation at a16z Crypto, the a16z crypto team believes that decentralized finance (DeFi) can make financial services and the digital economy more efficient, interoperable, reliable and user-centric. However, the "Midnight Broker Reporting Rule" recently issued by the U.S. Treasury Department is seen as a direct threat to this vision and may hinder the innovation and development of the U.S. DeFi field. a16z supports legal proceedings filed by organizations such as the Foundation, the Blockchain Association and Texas Blockchain against the Treasury Department, Treasury Secretary Yellen and the IRS, arguing that the rule exceeds the statutory authority of the Treasury Department, violates the Administrative Procedure Act (APA), and is suspected of being unconstitutional. a16z said it will continue to provide support for DeFi technology through legal and legislative means.
The term “midnight broker” primarily refers to recent regulatory developments from the U.S. Internal Revenue Service (IRS) and its impact on software providers in the cryptocurrency space. The term emerged during discussions about new IRS rules that classify certain software providers as “brokers,” thereby imposing strict Know Your Customer (KYC) requirements on them.
