false

Kraken has been ordered to provide information about its users to the Internal Revenue Service (IRS), according to a June 30 court filing.

Users who traded $20K affected

The filing says that Kraken must provide the IRS with identifying information about users that traded at least $20,000 worth of cryptocurrency over a one-year period. This applies to users who were active between Jan. 1, 2016 and Dec. 31, 2020.

The court ruled that Kraken must share certain information such as user names, birth dates, tax numbers, addresses, and contact information.

The court otherwise conceded to Kraken that the government made overly broad requests for information. Notably, it decided that the tax agency’s requests for KYC/AML data and information on users’ employment, net worth, and source of wealth were overbroad. As such, Kraken is not yet required to provide that data to the IRS.

In addition to providing user information, Kraken must also provide certain on-chain information such as transaction hashes and blockchain addresses. The amount of blockchain data that Kraken must provide accounts for “chainsplitting” or hard forks, which can affect user holdings but which are not fully observed in Kraken’s records.

Finally, Kraken must provide certain transactional records, namely those that were not found to be part of the government’s overbroad requests.

IRS has sought Kraken data for years

The IRS has attempted to obtain Kraken’s user records since at least May 2021, when it was permitted to serve a summons to the exchange. The current case began in February 2023 after officials began an attempt to enforce the 2021 summons.

The tax agency has previously obtained access to customer data from other crypto platforms including Coinbase, Circle, and SFOX.

Recent surveys suggest that the vast majority of crypto investors do not pay taxes on their investments and earnings even when rules exist. The IRS’ various actions against crypto exchanges are undoubtedly an attempt to combat this.

The post Kraken ordered to provide IRS with user data appeared first on CryptoSlate.