The U.S. Federal Court has granted the Internal Revenue Service (IRS) authorization to issue a John Doe subpoena to the financial technology company Circle to seek all information about U.S. taxpayers who traded on its platform between 2016 and 2020 At least $20,000 in crypto assets.
The subpoena will apply to Circle Internet Financial Inc., including all “predecessors, subsidiaries, divisions and affiliates, including Poloniex LLC.”
According to the Department of Justice announcement, Judge Richard Stearns (Richard Stearns) concluded that “there is a reasonable basis to believe that cryptocurrency users may not comply with federal tax laws.”
The document also pointed out that the IRS “has not claimed that Circle has engaged in any improper conduct related to its digital currency exchange business,” adding:
“The subpoena seeks information related to the IRS̵7;s “investigation of identifiable groups or categories of people”, and believes that the IRS has a reasonable basis to believe that it “may not comply with any provisions of any internal tax law.” “”
A representative of the circle told Law360: “We are reviewing [the summons]Of course, I hope to cooperate with the Internal Revenue Service (IRS) in response to court orders.
David Hubbert, Attorney General of the Tax Division of the Department of Justice, said: “People who use cryptocurrency for transactions must fulfill their tax obligations like other taxpayers. The Department of Justice will continue to cooperate with the Internal Revenue Service (IRS), To ensure that cryptocurrency owners pay their due taxes.”
Circle was founded in October 2013 by Jeremy Allaire and Sean Neville. The company launched a Bitcoin wallet the following year, which later became its encrypted payment application Circle Pay . In 2018, Circle cooperated with Coinbase to launch USD Coin, and Coinbase is currently the second largest stablecoin by market value.
Circle acquired the popular digital asset exchange Poloniex in 2018, but announced that Poloniex would “spun off” into a new investment company that was in contact with Tron’s Justin Sun the following year.