Coinbase has asked the U.S. Supreme Court to revisit the so-called “third-party doctrine” in a case involving the IRS and the seizure of crypto customer data, warning that the current legal framework threatens privacy rights in the digital age.
In an amicus brief filed Wednesday, the crypto exchange argued that the doctrine—which holds that individuals have no expectation of privacy when they voluntarily provide information to third parties like banks—needs to be updated to reflect modern technologies such as blockchain.
“This Court’s guidance is especially important here because this case involves a new technology—blockchain—that is particularly susceptible to surveillance abuse,” the filing stated.
The case stems from a 2017 IRS request for customer data from Coinbase, including records related to security settings, transactions, and user communications. Coinbase challenged the request, but a district court ultimately required partial compliance, limiting the scope of the IRS’s inquiry.
In 2020, Coinbase user James Harper filed a lawsuit claiming the IRS violated his rights by obtaining his information without a warrant or proper notice. The Supreme Court is now being asked to decide whether to take up the case.
Coinbase Chief Legal Officer Paul Grewal said the company supports tax compliance, but the IRS’s actions raise broader concerns.
“This goes far beyond crypto,” Grewal wrote on X. “This applies to banks, phone companies, ISPs, email—your right to privacy shouldn’t depend on whether your data is digital or physical.”
Other parties supporting the petition include Elon Musk, the Cato Institute, and the DeFi Education Fund, all of whom have filed separate amicus briefs urging the Court to review the case.
Separately, Coinbase received a subpoena from the Commodity Futures Trading Commission (CFTC) as part of its investigation into the crypto prediction market platform Polymarket.
The subpoena was disclosed in a customer notice and shared on X by EthHub co-founder Eric Conner. It seeks general customer information, including details related to specific user accounts.
The notice informed customers that Coinbase “may be required” to provide user account data to the CFTC unless legally prevented by a motion to quash or another filing submitted by January 15, 2025. Coinbase clarified that no immediate action was required from users.