Crypto Non-Profit Coin Center Sues U.S. Treasury Over This

Crypto research firm Coin Center said on Saturday it has filed a lawsuit against the U.S. Treasury Department over “unconstitutional” tax laws.

The suit pertains to the Infrastructure Investment and Jobs Act passed last year, a $1.2 trillion spending bill that intended to improve infrastructure and stimulate economic growth.

Specifically, Coin Center alleges that a tax provision in the bill encourages financial surveillance of crypto users. This provision, according to the firm, violates the civil liberties of crypto users by requiring them to report certain personal data to the government.

The provision will take effect in 2024. Treasury chair Janet Yellen and the Internal Revenue Service are named as defendants in the case.

Coin Center calls tax provision unconstitutional

The Washington-based non profit organization said in a blog post that the tax provision, number 60501, requires all entities that receive over $10,000 in crypto to report the sender’s name, birth date and Social Security number to the government.

The firm called the provision an “affront to our civil liberties,” and intends to challenge the bill in court with two major claims.

Its suit argues that forcing citizens to collect “highly intrusive” information on other people is unconstitutional under the Fourth Amendment. It also argues that potentially forcing political organizations to report their donors violates the First Amendment.

If the government wants us to report directly about ourselves and the people with whom we transact, it should prove before a judge that it has reasonable suspicion warranting a search of our private papers.

-Coin Center Directors Jerry Brito and Peter Van Valkenburgh

Crypto privacy a contested topic

Coin Center’s suit is the latest in a long-running debate of privacy in crypto. The space’s potential for the pesudo anonymous transfer of funds has attracted widespread ire by regulators, who allege it holds great potential for money laundering.

The European Union has already introduced legislation outlining strict reporting requirements for crypto transactions, to prevent money laundering.

The prospect of Russia using crypto to bypass recent sanctions has also increased calls for more monitoring.

With more than five years of experience covering global financial markets, Ambar intends to leverage this knowledge towards the rapidly expanding world of crypto and DeFi. His interest lies chiefly in finding how geopolitical developments can impact crypto markets, and what that could mean for your bitcoin holdings. When he isn’t trawling through the web for the latest breaking news, you can find him playing videogames or watching Seinfeld reruns.
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