June 13, 2021

Volume XI, Number 164

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DOJ Tax Division Shows Continued Interest in Cryptocurrency

On May 5, 2021, another federal district court, this time for the Northern District of California, permitted the IRS to proceed with a John Doe summons very similar to the one served on Circle last month (the subject of a recent post).  This time, the Summons seeks information on customers of a San Francisco-headquartered digital currency exchange company called Payward Ventures Inc. and Subsidiaries, d/b/a Kraken.  Just like in the Circle case, the Summons only applies to customers who have engaged in a total of $20,000 or more in transactions with the company between 2016 and 2020.  Also like in Circle, thus far, DOJ is not alleging any wrongdoing by Kraken or its customers.

The Summons, along with the DOJ’s press release, serves as another stern reminder to cryptocurrency users: federal tax laws apply to you!  And, it indicates a continued enforcement interest against those who attempt to use cryptocurrency’s “inherently pseudoanonymous aspect” to evade U.S. laws.

© 2021 Proskauer Rose LLP. National Law Review, Volume XI, Number 126
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About this Author

Lindsey A Olson Attorney, Litigation, Proskauer Law Firm
Associate

Lindsey Olson is an Associate in the Litigation Department, resident in the New York office.

212-969-3491
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