While New York State Consider Banning Crypto Mining, IRS Extends Scrutiny on crypto Exchange Kraken
Cryptocurrency mining and its environmental impact has always been a big issue for regulators worldwide. Earlier this week, a new bill made its way to the New York Senate that seeks to bring a three-year moratorium and pause crypto mining activities within the State of New York.
The bill notes that during this period, the New York State will investigate the consequences that cryptocurrency mining has on the environment. The bill text calls for “an act to establish a moratorium on the operation of cryptocurrency mining centers; and providing for the repeal of such provisions upon expiration thereof,” reports TechSpot.
However, the bill doesn’t much clearly define what it means by a “cryptocurrency mining center”. It is safe to assume that it would include any commercial operations but doesn’t give on the working of individuals casually mining digital assets.
If the New York senate passes the bill, it shall be available 120 days for public comments. Besides, the New York State Department of Environmental Conservation will hold at least one public hearing in each region of the state.
On the other hand, the Internal Revenue Services (IRS) has extended its scrutiny on cryptocurrency exchange and asked it to provide details of its users conducting over $20,000 in crypto transactions in any given year, between 2016 to 2020.
This comes as the Federal Court of California authorizes the IRS for issuing a “John Dee summons” on the exchange. Note that this is just a regulatory scrutiny and Kraken hasn’t been accused of any wrong doing here.
As per the IRS explanation, the IRS is currently looking at the records of an “ascertainable group or class of persons” who might have failed in complying with internal revenue laws and tax reporting.
Besides, the IRS will also check if Kraken has complied with its record-keeping responsibilities and have the necessary KYC details of its users. In the official press release by the court, IRS Commissioner Chuck Retig noted: “This John Doe summons is part of our effort to uncover those who are trying to skirt reporting and avoid paying their fair share”.
The IRS is currently looking for information on five different classes of the U.S. tax payers. This includes reporting limited income despite trading digital assets between a range of $5 million to $56 million. Besides, the IRS said that it is also looking for people who submitted tax returns in 2017 and 2018 with income more than $2 million each year.