A recent report indicates that managing digital assets within the IRS's criminal division requires reform.
Findings from the Government Watchdog
In a report released on Tuesday, the US Treasury Inspector General for Tax Administration noted deficiencies in the IRS Criminal Investigation division related to the seizure and safeguarding of digital assets. The inspector indicated that from December 2023 to January 2025, the IRS failed to adhere to all guidelines regarding seizure memorandums for confiscated crypto.
Recommendations for the IRS
The report outlined recommendations, which the IRS-CI agreed upon, including ensuring personnel are trained to comply with seizure memorandum requirements; establishing an inventory system to manage seized digital assets accurately; and updating internal guidelines to include time frames for preparing seizure memorandums and updating records.
Amount of Cryptocurrency Held by the US Government
Estimates of how much cryptocurrency the US government currently holds vary based on criminal case information. As of March, White House officials indicated there were approximately 200,000 BTC in government stockpiles, valued at over $21 billion at the time of publication. Notable seizures included over 94,000 BTC linked to the 2016 Bitfinex hack and more than 50,000 BTC from the Silk Road marketplace.
In conclusion, the report highlights the need for improved management of digital assets within the IRS and the importance of following established protocols.
