The IRS is pushing ahead with its crypto transaction surveillance initiative, raising concerns of increased cryptocurrency seizures.
In response to President Biden's Executive Order 14067, the DOJ released a study in 2022 outlining potential uses of this data that could affect cryptocurrency holders. The DOJ may have greater authority to take cryptocurrencies, which might provide difficulties for cryptocurrency holders, as the IRS is slated to oversee Americans' cryptocurrency activity by processing 8 billion tax returns. The research also emphasizes that even while the government has a history of effectively recovering significant quantities of cryptocurrencies, improved seizure capabilities are still necessary. More bitcoin seizures may result from the ongoing initiative and the possibility of increased surveillance, especially in the case of administrative forfeiture, which doesn't require court intervention.
The US government has become one of the largest Bitcoin holders, with about 210,000 coins, valued at $5.5 billion, despite Bitcoin's limited supply of 21 million coins. As the IRS's cryptocurrency transaction monitoring gains traction, concerns grow regarding the potential for increased cryptocurrency seizures and their impact on crypto holders.
