U.S. government urges court to dismiss lawsuit over Coinbase users' cryptocurrency records

Odaily Planet Daily News The U.S. government argued in a Supreme Court filing that Coinbase user James Harper had no right to prevent the Internal Revenue Service (IRS) from obtaining his cryptocurrency trading records. In a document filed on May 30, U.S. Attorney General D. John Sauer argued that Coinbase user James Harper had no Fourth Amendment right to protect his financial records held on the exchange. The government claimed that Harper "voluntarily" shared his data with Coinbase and that the IRS followed due process of law to obtain the data through a judicially approved subpoena. Harper's case revolved around an IRS investigation in 2016 into the widespread underreporting of taxes on cryptocurrency gains. At the time, the IRS found that millions of Coinbase users traded Bitcoin, while relatively few taxpayers reported cryptocurrency gains, and subsequently forced Coinbase to hand over the records of its high-volume customers. Harper, who traded Bitcoin on Coinbase in the relevant years, later filed a lawsuit claiming that the IRS's actions constituted an unconstitutional search of his personal records. A lower court disagreed, ruling that Coinbase's records were business documents, not Harper's personal documents, and that the IRS acted legally. In its complaint, the government argued that Supreme Court precedent supports the IRS's position. The government cited past cases that emphasized that individuals have no reasonable expectation of privacy in financial records held by a third party, Coinbase. The Supreme Court has not yet decided whether to hear the case. If it dismisses, the First Circuit's ruling in favor of the IRS will remain intact. (Cointelegraph)