The cryptocurrency sector in the United States faces two significant developments. According to Eric Trump, son of the 47th President Donald Trump, US-based projects like Solana 
$170 (SOL), XRP, Cardano 
$0.753357 (ADA), and Hedera (HBAR) will soon be exempt from capital gains tax. In contrast, foreign projects may encounter taxes of around 30%. Additionally, Senator Ted Cruz has moved to repeal a controversial IRS rule requiring decentralized finance (DeFi) protocols to share user data, arguing that it stifles innovation and violates privacy.
US-Based Altcoin Projects to Receive Tax Exemption
According to Eric Trump’s statements, US-based cryptocurrency projects will not pay capital gains tax. This exemption could provide local projects a competitive edge in the global market. For instance, gains from value increases of assets like XRP and HBAR will not be taxed.
Conversely, gains from foreign cryptocurrency projects will face a tax of up to 30%. Coingecko’s creation of a special category for US-based projects indicates that these developments could alter market dynamics.
Experts suggest that tax exemptions may increase trading activity in the cryptocurrency market. However, no official legal regulation has been announced yet. Congressional approval is necessary for Trump’s claims to materialize into concrete actions. Observers are curious about how tax policies will affect decentralized projects in the sector.
A New Battle for DeFi Protocols
Senator Ted Cruz opposes the IRS’s requirement for DeFi protocols to share user data. Cruz aims to repeal this rule using the Congressional Review Act. The regulation, which took effect in December, mandates that DeFi protocols share user information with the government, similar to traditional financial institutions.
Critics emphasize that such a rule undermines the decentralized nature of DeFi. Many DeFi protocols lack a centralized authority to collect user data. Cruz argues that the regulation could weaken the US’s leadership in blockchain innovation and reiterates his support for alternatives like Bitcoin 
$106,983 over central bank digital currencies (CBDCs).
Cruz’s initiative has garnered support particularly from Republican senators. The majority in Congress could accelerate the voting process necessary to repeal the regulation.
