Breaking: SEC sues Kraken for running an unregulated exchange
|The US Securities and Exchange Commission (SEC) has filed a case against the cryptocurrency exchange Kraken for infringing securities laws and commingling client assets with company assets among other things.
Based on the report, the SEC levies charges against the platform for operating as an unregistered securities exchange, broker, and dealer.
SEC levies charges against Kraken exchange
James Seyffart, an ETF specialist with Bloomberg Intelligence, has likened the lawsuit to the one against Coinbase, with the SEC listing several digital assets it claims to be securities. There are 16 cryptos explicitly listed here, including Solana, Cardano and Algorand.
It adds to the list of crypto trading platforms that the financial regulator has clamped down against this year, including Binance and Coinbase exchanges, whose charges bordered along trading unregistered securities.
For Binance, the case may be nearing its end after the US Department of Justice demanded an ironic $4 billion in settlement fees for alleged crimes of fraud, money laundering, and sanctions violations against the platform and its CEO, Changpemg Zhao.
This is a longstanding case, going back to August when the DOJ deliberated levying the charges and their implications to customers.
The figure is ironic, considering the number "4" is CZ's signature when he wants to dispel FUD in the market.
Who knew that when @cz_binance kept saying “4”, the U.S. Government would accept that as a settlement offer?
— John E Deaton (@JohnEDeaton1) November 20, 2023
Who knew that when @cz_binance kept saying “4”, the U.S. Government would accept that as a settlement offer?
— John E Deaton (@JohnEDeaton1) November 20, 2023
According to another legal expert and former commissioner at the SEC, John Reed Stark, Binance may not agree to a deferred prosecution agreement with the government.
Why It's Hard to Believe That Binance Will (or Can) Agree to a Deferred Prosecution Agreement with US DOJ (Though I Guess Anything is Possible in the Cryptoverse).
— John Reed Stark (@JohnReedStark) November 20, 2023
Apparently, per a team of highly respected Bloomberg investigative journalists, the U.S. Justice Department is… pic.twitter.com/2SadwouuT8
Why It's Hard to Believe That Binance Will (or Can) Agree to a Deferred Prosecution Agreement with US DOJ (Though I Guess Anything is Possible in the Cryptoverse).
— John Reed Stark (@JohnReedStark) November 20, 2023
Apparently, per a team of highly respected Bloomberg investigative journalists, the U.S. Justice Department is… pic.twitter.com/2SadwouuT8
If Binance agrees, it could end an investigation of the cryptocurrency exchange that has been ongoing for years.
Meanwhile, Kraken has denied the claims, committing to vigorously defend its position.
Today, the SEC filed a complaint alleging that Kraken operates as an unregistered national securities exchange, broker, and clearing house. We disagree with their claims and plan to vigorously defend our position. https://t.co/a0C4wzBo3f
— Kraken Exchange (@krakenfx) November 21, 2023
Today, the SEC filed a complaint alleging that Kraken operates as an unregistered national securities exchange, broker, and clearing house. We disagree with their claims and plan to vigorously defend our position. https://t.co/a0C4wzBo3f
— Kraken Exchange (@krakenfx) November 21, 2023
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.