Kraken co-founder Jesse Powell commented that the $4.3 billion settlement between the U.S. Department of Justice and Binance makes the crypto industry feel “a bit more fair.” He suggested that Binance’s rapid growth and avoidance of consequences raised questions, but enforcement so far has targeted “the good guys” like Kraken.
Powell said new threats to crypto’s reputation persist, as “dodgy operations” give governments excuses to criticize crypto and impose strict regulations. He argued the industry must “self-police” because government protections have been inadequate.
Powell also referenced Coinbase and Ripple as examples of firms facing SEC scrutiny despite making efforts to comply. He criticized the SEC for targeting accessible companies rather than egregious offshore offenders, implying enforcement is not about protecting people.
This comes amid an ongoing dispute between Kraken and the SEC. The SEC recently filed a lawsuit over Kraken’s staking services despite a previous $30 million settlement over the same issue. Powell suggested the SEC extorts settlements from companies that can’t afford prolonged legal battles.
Kraken maintains the SEC’s argument, that its products are unregistered investment contracts, has no legal basis. It claims there are no registration requirements for crypto exchanges, broker-dealers or clearing agencies dealing with investment contracts. Kraken argues the SEC is demanding compliance with a non-existent regime.
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