IRS Targets Crypto Exchange Kraken: Unveils $20,000+ Crypto Transactions
IRS Targets Crypto Exchange Kraken: Unveils $20,000+ Crypto Transactions

IRS Targets Crypto Exchange Kraken: Unveils $20,000+ Crypto Transactions

• The Internal Revenue Service (IRS) is seeking an order from the US District Court to enforce a summons on Kraken and its subsidiaries over an investigation into US taxpayer customers who conducted crypto transactions worth $20,000 or more between 2016 and 2020.
• Kraken allegedly failed to comply with the summons issued by the IRS in May 2021.
• According to the Department of Justice, the IRS has been given power to force Kraken to reveal information about US taxpayers who conducted USD 20,000 or more worth of crypto transactions in that period.

The IRS’s Investigation Into Crypto Transactions

The Internal Revenue Service (IRS), America’s tax authority, is currently investigating Kraken, one of the world’s largest crypto exchanges, over its customers’ crypto transactions worth $20,000 or more between 2016 and 2020. In May 2021, a branch of California District Court granted permission for the IRS to issue a John Doe summons on Kraken in order to discover these identities and federal tax liabilities.

Kraken Allegedly Ignoring IRS Summons

Though discussions between both parties have taken place, according to Law360,”Cryptocurrency exchange Kraken Inc. hasn’t complied with a court-approved IRS summons seeking records on customer identities and transactions and should be forced to furnish the records.” This was reaffirmed by USA counsel petitioning for an order from the Northern District of California that would enforce this summons on all of Kraken’s subsidiaries and Payward Ventures—one of many companies that are part of Kraken—to produce all relevant documents requested by the IRS.

John Doe Summons Explained

A John Doe summons permits The Internal Revenue Service to “obtain the names, requested information and documents concerning all taxpayers in a certain group” without having any specific knowledge about them beforehand. The DoJ has also stated that this information may be used for determining taxpayers’ federal tax liabilities who have not been complying with their obligations as determined by law.

Kraken Responds To Claims Made By Filing

In response to claims made in this February 3 filing from USA counsel, a spokesperson from Kraken told Cryptonews,”We have not been served with referenced petition but we are reviewing it.” They further added,” We take our legal obligations very seriously and take great pride developing relationships with regulators around world seek clarity where needed.”


The giant crypto exchange has been accused by American authorities of failing provide required information regarding American customers who conducted high-value crypto trades during 2016-2020 period , which could potentially lead them being subject penalties if found guilty neglecting their federal tax liabilities . However , no formal action has yet taken against company at this time .