Cryptocurrency advocacy group DeFi Education Fund (DEF) has urged a US court to consider the unique aspects of blockchain technology when evaluating cryptocurrency users' privacy rights under the Fourth Amendment.
DEF archived an amicus curiae brief to the U.S. Court of Appeals (First Circuit) on October 20, supporting James Harper's appeal against the Internal Revenue Service as part of a fight to prevent the U.S. government from In the US, unlimited access to a user's transaction history on cryptocurrency platforms.
Harper was one of 14,355 Coinbase users whose data was delivered by cryptocurrency exchange to the IRS following a 2017 court order, which sparked a fight for stronger digital privacy rights.
DEF is proud to support the industry by filing amicus briefs in precedent-setting cases such as Harper v. IRS, involving a John Doe subpoena to Coinbase that resulted in the private financial information of more than 14,000 users being sent to the IRS.
Our CLO @amandatums breakโฆ https://t.co/JidwyPMzcj
โ DeFi Education Fund (@fund_defi) October 20, 2023
DEF argued that the Fourth Amendment needs to be revised to rebalance law enforcement's investigative powers and an individual's right to financial privacy in the digital age.
โWhen old precedents meet new technology, courts must 'ensure the preservation of that degree of privacy from the government that existed when the Fourth Amendment was adopted.'โ
The Fourth Amendment to the United States Constitution serves to protect people from unreasonable searches and seizures by the government.
DEF also pointed to the Carpenter v. United States case to argue that the Fourth Amendment is intended to limit the US government's ability to obtain data from third-party platforms like Coinbase.
The advocacy group further explained that because cryptocurrency transactions can be traced on public ledgers, it is possible to connect real-life identities with their pseudonymous addresses.
This affected the livelihoods of the 14,355 users in the Coinbase case, DEF explained:
"Thus, the government's request in this case involved all of each user's transactions, now and always, including their 'family, political, professional, religious, and sexual associations.'
"It provided the government with a detailed, encyclopedic and effortlessly compiled synopsis of the lives of Harper and 14,354 others," the DEF added.
This degree of knowledge far exceeds what can be achieved through traditional banking records, the lobby group argued.
Related: Blockchain Privacy Groups Urge New US Congress to Protect Privacy Rights
4/ We maintain that the Court must take into account the fundamental differences between crypto technology and TradFi because blockchain data provides the government with an intimate view of a person's financial life in the past, present and future. pic.twitter.com/KORSLRhqNY
โAmanda Tuminelli (@amandatums) October 20, 2023
The mission of the DeFi Education Fund is to educate policymakers on the benefits of decentralized finance and achieve regulatory clarity for the DeFi ecosystem.
The final decision in Harper v. Werfel and the Internal Revenue Service is expected to set a precedent for digital privacy rights and enforcement measures in the US.
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