Oct. 15, 2023
I am extremely unhappy with the content of the PDF document titled "Gross Proceeds and Basis Reporting by Brokers and Determination of Amount Realized and Basis for Digital Asset Transactions" from the IRS and the Treasury Department. First and foremost, I have serious concerns regarding privacy and the safety of my sensitive financial data and social security number. The proposed regulations would require brokers, including digital asset trading platforms, to collect and store this information. This opens the door to potential privacy breaches and puts individuals at risk for identity theft. It is unacceptable to impose such reporting requirements without ensuring proper safeguards are in place to protect the personal information of taxpayers. Furthermore, the proposed regulations are confusing and impractical. The document states that reporting requirements would apply to various participants in the decentralized finance (DeFi) space. However, this would lead to multiple, inconsistent reports being generated for the same transaction. It is unreasonable to expect market participants to navigate through such complex reporting requirements, especially when they are prone to ambiguity. Additionally, the impact of these regulations on participants abroad has not been adequately addressed. The proposed regulations do not sufficiently limit reporting requirements for protocols operated outside the United States or for users located outside the United States. This creates unnecessary challenges and complications for those operating in the global digital asset market. Moreover, the document fails to provide clear and accurate definitions for key terms such as "platform," "wallet," "smart contracts," and "validator." The lack of proper technical definitions will undoubtedly lead to confusion and inconsistencies in compliance and enforcement. It is essential that these terms are defined properly to avoid misunderstandings and mistakes. In summary, I am highly dissatisfied with the proposed regulations outlined in the PDF document. The privacy concerns, the potential for identity theft, the confusing reporting requirements, the inadequate consideration of cross-border implications, and the poor definition of key terms all contribute to my strong opposition to these proposed regulations. I urge the IRS and the Treasury Department to reconsider and address these concerns before implementing any new rules. Sent from my iPhone