SEC Probing Kraken for Offering Unregistered Securities: Could Crypto Industry Feel Impact?

• The SEC is probing crypto exchange Kraken for offering unregistered securities to its customers in the U.S.
• If the SEC finds that Kraken sold unregistered securities, the exchange could receive fines, penalties, or other punishments for securities law violations.
• If Kraken settles with the regulatory, Gensler and his team could potentially look to reinforce the agency’s bid to assume jurisdiction over crypto tokens.

SEC Investigates Kraken

The U.S. Securities and Exchange Commission (SEC) has launched a probe into crypto exchange Kraken over possible breach of U.S. securities laws by offering unregistered securities to its customers in the United States.

Potential Consequences

If the SEC determines that Kraken sold unregistered securities, it could face fines, penalties, or other punishments for violating security laws.

SEC’s Authority Over Crypto Tokens

If Kraken settles with the regulatory body, it could bolster SEC Chairman Gary Gensler’s efforts to extend jurisdiction over cryptocurrency tokens under Howey test for determining whether an asset is a security or not.

Other Probes Launched By SEC

Kraken is one of many firms which have faced similar probes by the SEC in recent times as part of their clampdown on crypto assets deemed as securities without providing clear guidelines on regulating them in the country.

Conclusion

The probe on Kraken has reached advanced stages and a conclusion is expected soon in coming days which could have significant impacts on both the crypto industry and how assets are regulated within it if settled with regulators

10. Februar 2023