Cryptocurrency exchange Kraken is currently in a legal battle against the US Internal Revenue Service (IRS) over the IRS’s request to access information on users of the exchange.
Kraken is reportedly seeking to have the request invalidated by the court, and a hearing has been scheduled for May to hear arguments from both parties involved.
In a statement, Kraken accused the IRS of broadening its request beyond what is permitted by basic rules.
The IRS had requested information on Kraken accounts with at least $20,000 in cryptocurrency, as well as transactions made on those accounts between 2016 and 2020.
This is not the first time that the IRS has sought to obtain data on cryptocurrency transactions.
In 2022, the IRS applied for court permission to access transaction data from clients of cryptocurrency dealer SFOX and its partner M.Y. Safra Bank, with the intention of identifying potential violations of tax laws.
Kraken has had run-ins with US authorities before. Last fall, the exchange agreed to pay a fine to the US Treasury Department for violating sanctions.
The exchange’s management voluntarily disclosed the violations and agreed to pay a fine of $362,000.
As part of the agreement, Kraken also committed to investing an additional $100,000 in their compliance system.