Crypto exchange Kraken has announced that it will share the data of some of its customers to the Internal Revenue Service (IRS) in November 2023. This decision follows a court order issued last June in a dispute between Kraken and the IRS. Only American Kraken users whose transactions exceed $20,000 between 2016 and 2020 are affected.
Kraken hands over its US customers to the IRS
The data of several American users of Kraken will soon be in the hands of the Federal Tax Agency. The announcement comes from the CEX (Centralised Exchange) Kraken itself. In an e-mail sent to some of its customers, the exchange has announced that user information covered by last June’s court order will be shared with the Internal Revenue Service (IRS).
The court ordered Kraken to produce profile information and transaction histories for a specific cohort of customers. Kraken expects to share this information covered by the court order in early November 2023..
Kraken – https://www.kraken.com/.
The data to be shared includes :
- Names
- Date of birth
- Tax identification number
- Addresses
- Telephone numbers
- Transaction history from 2016 to 2020
All customers of Kraken are not covered by this sharing of information with the IRS. According to the aforementioned court order, only US Kraken users with annual transactions of more than $20,000 between 2016 and 2020 are affected. According to court estimates, the number of affected users is close to 42,017.
The culmination of an old dispute between Kraken and the IRS
The sharing of Kraken customer information with the Internal Revenue Service is the culmination of more than two years of litigation. In May 2021, Kraken was asked by the IRS to share its US customer data. The federal tax agency did not accuse Kraken of any violation of the law. The Internal Revenue Service just felt that some users were not declaring income earned and taxes due on their crypto transactions.
Kraken opposed this claim in a California court, raising security and privacy concerns for its customers. After two years of proceedings, the CEX was dismissed by the California Supreme Court court order of June 2023.
Sharing customer data with the IRS is common practice in the US. For example, in 2018, the crypto exchange Coinbase shared details of around 13,000 users with the tax agency.
It’s true that this sharing of customer information shows the true face of the centralized crypto-related ecosystem, wrongly presented as a breeding ground for criminals. However, they pose a real problem of confidentiality for users.
I dream of a world where every citizen has total control over themselves, including their finances. I believe that Bitcoin is one of the tools that will achieve this revolution. Since 2019, I am learning about this cryptocurrency and spreading the word around.
