On September 15, the U.S. Department of Justice (DOJ) announced a case involving an early Bitcoin investor who admitted to "filing false tax returns that underreported his cryptocurrency gains." Texas resident Frank Richard Ahlgren III pleaded guilty to underreporting capital gains from the sale of $3.7 million worth of Bitcoin.

According to court documents, Ahlgren purchased 1366 Bitcoin in 2015, each costing less than $500. In October 2017, he sold 640 Bitcoin for approximately $3.7 million and used the proceeds to buy a home in Park City, Utah. However, Ahlgren's 2017 tax return falsely inflated his cost basis for the Bitcoin purchases, resulting in underreported capital gains.

Additionally, he failed to report $650,000 in Bitcoin sales from 2018 and 2019. The DOJ stated: "In total, Ahlgren caused a tax loss of over $550,000 to the U.S. Treasury." Ahlgren is scheduled to be sentenced at a later date. He faces a maximum of three years in prison, as well as a period of supervised release, restitution, and fines.