That was coinbase's argument in this case. Commodity trading is largely unregulated in the United States and this request from the IRS is highly unusual for commodity exchanges (mostly it's very broad scope) .

Commodity exchanges are actually largely unregulated in the US. The existence of a large complicated federal law called the "Commodity Exchange Act" may at first blush make you think otherwise, but the CEA establishes rules for futures exchanges (including commodity futures exchanges), not commodity exchanges.