SEC Lawsuit Against Kraken Proceeds After Judge’s Decision

Bloomberg has reported that cryptocurrency exchange Kraken may face legal action from the U.S. Securities and Exchange Commission (SEC) for not registering as a cryptocurrency exchange.

In a related development, Kraken has been permitted to settle a lawsuit initiated by the SEC, which claims the platform operated as an unregistered securities exchange.

U.S. District Judge William H. Orrick’s decision allowed the case to move forward, representing a notable moment in the SEC’s ongoing scrutiny of the cryptocurrency sector.

Judge Orrick stated in a Friday opinion issued in San Francisco federal court that the SEC has reasonably argued that some cryptocurrency transactions on Kraken’s platform might be considered investment contracts, and therefore, securities subject to regulation.

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Kraken had previously attempted to have the lawsuit, initially filed by the SEC in November, dismissed. However, the judge’s ruling means the legal challenge will continue.

This decision follows earlier reports from Bloomberg News in June, indicating that Kraken, a well-established cryptocurrency exchange, was considering a final financing round ahead of a potential initial public offering (IPO).

Alexander Stefanov

With over 8 years of experience in the cryptocurrency and blockchain industry, Alexander is a seasoned content creator and market analyst dedicated to making digital assets more accessible and understandable. He specializes in breaking down complex crypto trends, analyzing market movements, and producing insightful content aimed at educating both newcomers and seasoned investors. Alexander has built a reputation for delivering timely and accurate analysis, while keeping a close eye on regulatory developments, emerging technologies, and macroeconomic trends that shape the future of digital finance. His work is rooted in a passion for innovation and a firm belief that widespread education is key to accelerating global crypto adoption.