News

Digital Chamber Flags Privacy Concerns In IRS Digital Asset Tax Draft

The world's leading blockchain trade association, The Digital Chambers flagged privacy concerns in its feedback on the IRS draft.
Published by
Digital Chamber Flags Privacy Concerns In IRS Digital Asset Tax Draft

Highlights

  • Digital Chamber submitted feedback on the proposed IRS tax reporting draft.
  • The association flags privacy concerns as a major issue with the draft.
  • The crypto community called for simple regulations to spur market growth.

The Digital Chamber has submitted its feedback on the Internal Revenues Service (IRS) draft 1099-DA released on April 18. The group flagged areas of concern for the wider blockchain sector on the new proposed tax reporting guideline. Other analysts and crypto stakeholders have also pointed out issues with the initial draft.

Advertisement

Digital Chamber Submits Pro-Industry Feedback

The Digital Chamber highlighted concerns for the proposed guidelines and recommended only necessary information required for reporting of digital asset transactions by taxpayers be requested.

As discussed further below, reviewing the draft form underscores the overbreadth of information requested by the Draft Form and the burdens associated with tax reporting on that form. We recommend that the final form 1099-DA request only information necessary to facilitate reporting of digital asset transactions by taxpayers…”

The proposed draft rolled out layers of regulations for taxpayers on crypto assets. These rules were tagged complex and the sector pushed for less burdensome methods. Digital Chamber explained on X (formerly Twitter) that the proposed law requires sensitive data including wallet addresses and transaction IDs. 

The crypto sector has raised privacy concerns with several regulatory requirements for users to disclose certain information. This spurred the growth of privacy coins to hide transactions and senders. Apart from privacy concerns, Digital Chamber noted that the draft should come with more detailed instructions for reporting and treating aspects of the ecosystem differently.

Advertisement

Crypto Enthusiasts Back Efforts

Virtual asset users support calls from the Digital Chambers to protect the privacy of taxpayers in the sectors. The community also stressed the importance of positive crypto laws to increase investment within the space. Similarly, blockchain firm, Consensys also wrote to the IRS asking to delay implementation of the rules citing the burden it will have on firms.

The law requires exchanges to report certain transactions and this will impact firms without those obligations previously.

Also Read: Is Michael Dell Warming Up To Bitcoin After Playful Crypto Tweet?

Advertisement
Share
David Pokima

David is a finance news contributor with 4 years of experience in Blockchain Technology and Cryptocurrencies. He is interested in learning about emerging technologies and has an eye for breaking news. Staying updated with trends, David reported in several niches including regulation, partnerships, crypto assets, stocks, NFTs, etc. Away from the financial markets, David goes cycling and horse riding.

Published by
Why trust CoinGape: CoinGape has covered the cryptocurrency industry since 2017, aiming to provide informative insights to our readers. Our journalists and analysts bring years of experience in market analysis and blockchain technology to ensure factual accuracy and balanced reporting. By following our Editorial Policy, our writers verify every source, fact-check each story, rely on reputable sources, and attribute quotes and media correctly. We also follow a rigorous Review Methodology when evaluating exchanges and tools. From emerging blockchain projects and coin launches to industry events and technical developments, we cover all facets of the digital asset space with unwavering commitment to timely, relevant information.
Investment disclaimer: The content reflects the author’s personal views and current market conditions. Please conduct your own research before investing in cryptocurrencies, as neither the author nor the publication is responsible for any financial losses.
Ad Disclosure: This site may feature sponsored content and affiliate links. All advertisements are clearly labeled, and ad partners have no influence over our editorial content.

Recent Posts

  • News

Changpeng Zhao “CZ” Warns Investors “Don’t Buy” Golden Statue Meme Coin After 27,000% Surge

Binance founder Changpeng Zhao (CZ) has publicly distanced himself from a newly launched token inspired…

October 29, 2025
  • News

Markets Expect October Fed Rate Cut as Bitcoin Repeats Post-FOMC Pattern

Bitcoin traders are preparing for a rise or fall in the price of Bitcoin, as…

October 29, 2025
  • News

Trump Tariff: China Resumes U.S. Imports After Agreement With South Korea

Trump tariff tensions have begun to ease as China resumed purchasing U.S. agricultural products for…

October 29, 2025
  • News

BlockDAG Hype Surges as Coinbase and Kraken Listing Rumors Spread

Conversations around BlockDAG, a multi-utility project currency currently in its presale stage, have gained more…

October 29, 2025
  • News

Bitget’s Institutional Volume Hits $23.1 Billion as UEX Framework Gains Global Momentum

Bitget has registered a significant increase in institutional trading volume at $23.1 billion. According to…

October 29, 2025
  • News

Breaking: Grayscale Joins Bitwise, Launches Solana ETF Covering Spot and Staking Features

Grayscale Investments has officially launched its Solana ETF, joining Bitwise after its successful debut yesterday.…

October 29, 2025