Northern peatlands contain ~30% of terrestrial carbon (C) stores, but in recent decades, 14% to 20% of the stored C has been lost because of conversion of the peatland to cropland. Microorganisms are widely acknowledged as primary decomposers, but the keystone taxa within the bacterial community regulating C loss from cultivated peatlands remain largely unknown. In this study, we investigated the bacterial taxa driving peat C mineralization during rice cultivation. Cultivation significantly decreased concentrations of soil organic C, dissolved organic C (DOC), carbohydrates, and phenolics but increased C mineralization rate (CMR). Consistent with the classic theory that phenolic inhibition creates a "latch" that reduces peat C decomposition, phenolics were highly negatively correlated with CMR in cultivated peatlands, indicating that elimination of inhibitory phenolics can accelerate soil C mineralization. Bacterial communities were significantly different following peatland cultivation, and co-occurrence diagnosis analysis revealed substantial changes in network clusters of closely connected nodes (modules) and bacterial keystone taxa. Specifically, in cultivated peatlands, bacterial modules were significantly negatively correlated with phenolics, carbohydrates, and DOC. While keystone taxa Xanthomonadales, Arthrobacter, and Bacteroidetes_vadinHA17 can regulate bacterial modules and promote carbon mineralization. Those observations indicated that changes in bacterial modules can promote phenolic decomposition and eliminate phenolic inhibition of labile C decomposition, thus accelerating soil organic C loss during rice cultivation. Overall, the study provides deeper insights into microbe-driven peat C loss during rice cultivation and highlights the crucial role of keystone bacterial taxa in the removal of phenolic constraints on peat C preservation.