A federal court has ordered cryptocurrency exchange Kraken to turn over account information to the IRS, including a history of all transactions, in order to verify underpayment of taxes by exchange users.
In February, the IRS filed suit in a California court after the cryptocurrency exchange settled SEC allegations of securities law violations. The regulator alleged that in 2021, Kraken was asked to verify the tax liability of users who transacted in cryptocurrency between 2016 and 2020. The exchange failed to comply with the request.
According to the latest court order, Kraken is required to disclose information about users whose transactions exceeded $20,000 in a year. The information includes the user's name, aliases, date of birth, tax identification number, mailing address, phone number, and more.
According to Coindesk, Kraken will have to hand over blockchain addresses and transaction hashes.
In doing so, Judge Joseph Spero denied an additional IRS request to obtain Kraken's source of capital, and several other requests were also denied.
According to the judge's decision, "The Court must determine whether the Government’s summons is narrowly tailored, that is, whether it is 'no broader than necessary to achieve its purpose. The court finds that these requests sought much broader information than what is necessary to achieve that purpose for the vast majority of Doe users."
The Kraken exchange launched in 2011 and provides access to margin trading in cryptocurrencies, staplecoins, indices, and futures.
Previously, we reported that Coinbase was increasing its rewards in US dollars.
