The Securities and Exchange Commission is investigating Kraken, one of the top bitcoin exchanges by volume (SEC). This is not the first time the cryptocurrency exchange has clashed with officials.
Kraken, a cryptocurrency exchange, has caught the attention of the Securities and Exchange Commission (SEC). The agency is investigating whether the exchange provided unregistered securities to American consumers.
According to a Bloomberg article on Feb. 9, the inquiry has reached a “advanced stage.” Although the details are still hazy, a deal might be achieved shortly.
Securities are regarded more risky than other financial products since they are not subject to the same level of regulatory monitoring. Nonetheless, despite appeals from chairman Gary Gensler for crypto platforms to register with the SEC, Kraken’s new CEO, Dave Ripley, refused to do so. Binance, the largest cryptocurrency exchange, has also been penalized for dealing unregistered securities.
It will be simpler to predict the outcome once the inquiry is completed and the SEC announces any conclusions. If the SEC discovers breaches of securities laws, the inquiry might result in fines, penalties, or other sanctions.
On CoinMarketCap, Kraken is now the third largest cryptocurrency exchange by volume. Needless to say, the ongoing regulatory investigation is not helpful for the sector. Kraken recently settled a complaint with OFAC for sanctions breaches and paid a $362,000 penalty.
Following the fall of institutions such as FTX, the crypto market experienced a harsh winter last year. This had an impact on numerous exchanges, including Kraken. The platform just let go of 30% of its employees.
According to Kraken’s head of strategy, the cut was allegedly independent of events like as the FTX implosion.