SEC Probes Kraken Over Securities Law Violations: Settlement May Near

 10. Februar 2023      


  • The SEC is probing crypto exchange Kraken for possibly violating U.S. securities law by offering unregistered securities.
  • If Kraken settles with the regulator, the SEC could potentially gain more jurisdiction over the crypto industry.
  • The SEC has mainly focused on enforcement without publishing a clear guideline for regulating crypto assets in the U.S.

SEC Tightens Enforcement

The U.S. Securities and Exchange Commission (SEC) is tightening its enforcement efforts and probing crypto exchange Kraken for possible breach of U.S. securities law by offering unregistered securities to its customers in the United States. The probe has reached advanced stages and a conclusion is expected to be announced in the next few days. If Kraken settles with the regulator, it could potentially result in fines, penalties or other consequences for violating securities laws, as well as give more power to the SEC to regulate cryptocurrency tokens in America.

Kraken’s Offerings Under Scrutiny

Kraken currently offers more than 185 cryptocurrencies globally, many of which are not offered in the United States. It remains unclear which specific offerings are being scrutinized by the securities regulator during this probe, but reports suggest that the investigation is focusing on whether or not certain tokens qualify as unregistered securities under existing laws and regulations.

Main Goal of Regulating Crypto

In December 2020, Gary Gensler, Chairman of the SEC said that their main goal for regulating crypto throughout 2021 was to make exchanges and lending platforms comply with applicable rules and regulations regarding investments and financial services products such as digital assets like Bitcoin (BTC).

SEC Going Down Enforcement Route

This isn’t the first time that an exchange had been probed by US regulators; Coinbase faced similar probes last year too. However, while many investigations don’t necessarily result in enforcement actions if Kraken settles with regulatory authorities then Gensler’s team could look to reinforce their bid to assume jurisdiction over cryptocurrency tokens with this settlement agreement.

In conclusion, it appears that this latest investigation into Krakens operations will be closely watched due to its potential implications on how US regulators view cryptocurrency markets going forward if they determine that unregistered securities were offered through this platform then expect stricter compliance requirements from all exchanges operating within American borders moving forward