The US government urged the Supreme Court not to take Coinbase’s user challenge against the Internal Revenue Service’s (IRS) effort to obtain his crypto transaction records.
In a File Due to May 30, Solicitor General D. John Sauer argued that coinbase user James Harper has no right to the fourth amendment to protect his financial records.
The government admitted that Harper “voluntarily” shared his data with Coinbase, and the IRS followed the proper legal procedure to obtain it through a judiciary approved call.
Harper’s case centered on a 2016 IRS investigation of widespread tax underreporting to cryptocurrency acquisitions. At this time, the IRS discovered a sharp gap between millions of Coinbase users who trade Bitcoin (Btc) and the relatively few taxpayers who reported the crypto acquisitions.
In response, the agency got a so-called “John Doe” that sprouted coinbase to turn over notes to high-volume customers.
Related: Coinbase data breach 2025: What was stolen and what you need to know
Coinbase user orders IRS in search of crypto records
Harper, who exchanged Bitcoin with Coinbase for relevant years, later charged, claiming that the IRS actions are worth a non -constitutional search of his personal records.
The lower courts did not agree, which decided that Coinbase’s records were business documents – not Harper’s private papers – and the IRS acted legally.
In its short time, the government argued that the previous Supreme Court supported the IRS position. Citing past cases such as United States v. MillerThe government emphasized that individuals do not have a reasonable privacy in the financial records held by the Third Parties Coinbase.
File also taught Coinbase’s own privacy policy, which warned users that information could be shared in law enforcement.
“Until the petitioner made the arguments below, the Court of Appeals correctly rejected them as both -foreclosed by the previous and unjust court,” the government said.
The Supreme Court has yet to decide whether it will hear the case. A refusal will leave the place of deciding the first circuit in favor of the IRS.
Related: The retired artist loses $ 2m in crypto in Coinbase impersonator
Coinbase suffers from breaking basic data
On May 15, Coinbase Announced a data violation where attacks are hired by customer support staff in India to access the user’s sensitive information.
The stolen data includes customer names, account balance, and transaction history. Coinbase confirmed the violation affecting nearly 1% of monthly transacting users. Among those Affected venture capitalist Roelof BothaSequoia Capital partner management.
Coinbase din faced with a wave of suits Following the revelation. At least six legal complaints were filed on May 15 and 16, along with plaintiff accusing the exchange of failing to implement sufficient security measures and avoid its response to violation.
Magazine: Coinbase Hack shows the law probably won’t protect you: here’s why
