As first reported by Motherboard, the Internal Revenue Service is seeking the personal data of all U.S. Coinbase users who transacted between 2013 and 2015. In a statement, a Coinbase spokesman said the exchange site was “very concerned with the indiscriminate breadth of the government’s request.”
The subjects of the data request are identified in court documents simply as an indeterminate number of “John Does.” The IRS filing further states that “There is a reasonable basis for believing that such group or class of persons may fail, or may have failed, to comply with one or more provisions of the internal revenue laws.
In other words, the IRS believes that buying Bitcoin is probable cause for making an individual the subject of a tax evasion investigation.
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Coinbase was the first fully licensed U.S.-based Bitcoin exchange, opening in January of 2015. It is now one of the largest Bitcoin exchanges handling dollar-bitcoin trades, though it still relatively small compared to exchanges catering to the massive Chinese cryptocurrency market.
The legal and tax status of Bitcoin has been a question mark since nearly its inception. One major early uncertainty was whether Bitcoin would be treated