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Hand Over: U.S. Regulators Might Force Coinbase to Disclose User Data

What happened

The U.S. Internal Revenue Service is heading to court to make Coinbase cryptocurrency exchange to hand over user data.

Why?

IRS first requested the data in 2016 – they claimed that some users haven’t properly reported their cryptocurrency gains for tax purposes.
Coinbase refused to comply, and after some negotiations the request was narrowed to about 8.9 million transactions and 14,355 account holders. But Coinbase still didn’t do it. Now a federal judge wants to allow a limited investigation into those gains.

Who can be affected?

Those who don’t pay taxes on crypto currency gains, we assume.

What can we learn from it

  • Everyone saw it coming: the growth rate of bitcoin and other currencies couldn’t have stayed below the tax radar for long
  • However, no one knows how long this will go on – Coinbase will probably have a chance to appeal.
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