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Paradigm, DEF Urges Protection of Fourth Amendment Rights in IRS Case

Press Releases Crypto News BeInCrypto Paradigm, DEF Urges Protection of Fourth Amendment Rights in IRS Case

Crypto investment firm Paradigm has filed an amicus brief urging the reversal of a district court’s decision in the James Harper lawsuit against the U.S. Internal Revenue Service (IRS).

In an October 20 court filing, Paradigm, supporting Harper’s case, accused the IRS of using a “John Doe” summons to gather the private records of roughly 10,000 Coinbase users.

Paradigm Fights to Protect The Fourth Amendment

The crypto venture capital firm argued that the dismissal of Harper’s complaint could impede the mainstream adoption of blockchain technology.

Paradigm emphasized that privacy is a cornerstone of blockchain technology, contending that user privacy should be safeguarded whether they use crypto exchanges or not. It said:

“The district court erred in concluding that there is no expectation of privacy when a person transacts on a crypto exchange. As suggested by the prefix “crypto”—derived from the space’s origins in cryptography—privacy is a foundational pillar of crypto transactions. There are many valid reasons why crypto users want to maintain some privacy—a user may, for example, want to keep hidden his or her participation in social movements, such as support for Ukraine’s defense against Russian aggression.”

Earlier this year, a U.S. judge upheld the IRS access to a John Doe summons. The ruling would allow the financial watchdog to access information about U.S. Coinbase customers who had used the platform between 2013 and 2015.

A John Doe summons is unique because it doesn’t target a specific individual but a group with certain characteristics. This action by the IRS was prompted by suspicions that some Coinbase users had not accurately reported their income, thus failing to disclose taxable transactions.

Harper later took legal action against the financial regulator in 2020. Harper alle

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Author: Oluwapelumi Adejumo

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