Crypto Platform Kraken Pays $30 Million and Ceases Staking Services to Settle SEC Charges
By Drew Hinkes, Carly Howard, and Judie Rinearson
The Securities and Exchange Commission (SEC) announced a settlement with the digital assets/cryptocurrency exchange Kraken whereby Kraken agreed to cease offering or selling securities through its crypto asset staking services, and agreed to pay a penalty of $30 million (comprising disgorgement, prejudgment interest, and civil penalties).
The announcement (see https://www.sec.gov/news/press-release/2023-25) has garnered some criticism, including comments from SEC Commissioner Hester Peirce, that the staking ban was “not a fair way of regulating”. (see https://decrypt.co/121029/sec-commissioner-peirce-kraken-staking-ban-not-fair-way-regulating)
This most recent SEC action has raised numerous questions about other crypto staking programs, and the impact on the crypto industry in general. While the K&L Gates Digital Assets team prepares an in-depth assessment of this latest action, feel free to contact us should you have any questions.
Drew Hinkes – Andrew.Hinkes@klgates.com
Carly Howard – Carly.Howard@klgates.com
Rich Kerr – Richard.F.Kerr@klgates.com
Jeremy McLaughlin – Jeremy.Mclaughlin@klgates.com
Judie Rinearson – Judith.firstname.lastname@example.org
Eden Rohrer – Eden.email@example.com