Kraken To Suspend USDT, DAI And WBTC Trading In Canada, Send Customer Data To IRS

Reuters

U.S.-based cryptocurrency exchange Kraken has announced that it will suspend transactions in Canada for several assets, including USDT, DAI, WBTC, WETH, and WALX, from Nov. 30. This decision comes after the exchange informed the public that its customer data would be sent to the Internal Revenue Service (IRS) in November.

"We constantly monitor the assets on our platform to ensure we are meeting the highest compliance standards in the crypto industry," a Kraken spokesperson said, confirming the suspensions.

"In accordance with recent Canadian regulatory changes and following extensive consultation with the CSA and OSC, we today notified our clients that we will soon be suspending trading for USDT, DAI, WBTC, WETH, and WAXL," the exchange said, adding that it is "committed to providing our Canadian clients with an exceptional trading experience."

According to an email shared online, deposits and trading functions for the said assets will cease as of Nov. 30. Withdrawals for these assets will no longer be possible after Dec. 4. The assets will be converted to U.S. dollars based on the prevailing market rate and credited to users' accounts by Dec. 5.

Kraken's announcement came a few days after it sent letters to clients informing them that the cryptocurrency exchange's loss in the court case left it with no choice but to comply and turn over sensitive customers' data to the IRS.

"Kraken expects to share this information covered by the court's order in early November 2023," read the email sent by the exchange to its clients.

The legal battle between the IRS and Kraken started in May 2021 when a U.S. federal court authorized the revenue service of the country to serve John Doe summons to the crypto exchange and its subsidiaries in its attempt to catch tax evaders.

At the time, the IRS said that the exchange failed to comply with the summons and filed a court document in February seeking permission to enforce the summons.

In June, a federal court ordered the crypto exchange to hand over the customers' data to the country's tax revenue service.

In July, Kraken released a statement related to the legal battle with the IRS: "We fought the IRS because they sought intrusive and unnecessary information about U.S. clients... Were this information leaked by the IRS, it would expose Kraken clients to identity theft and other harm, which Kraken prevented."