Kraken Challenges SEC’s Claims on Unregistered Securities
Cryptocurrency exchange Kraken has once again challenged the US Securities and Exchange Commission (SEC) over claims that it sold digital assets considered unregistered securities.
Kraken maintains that it has adhered to federal securities laws and argues that the digital assets listed on its platform do not qualify as securities or investment contracts. The exchange specifically disputes that assets like Algorand (ALGO), Cosmos (ATOM), Polygon (POL), Filecoin (FIL), Solana (SOL), and Cardano (ADA) meet the legal criteria for securities.
Kraken plans to take the matter to a jury trial. In its legal filing, the exchange criticizes the SEC for obstructing progress and asserts that the SEC is overstepping its authority by attempting to enforce regulations beyond its jurisdiction. Kraken’s CEO, Jesse Powell, has labeled the SEC’s lawsuit as part of a repeated regulatory strategy.
READ MORE: SEC Signals Possible Easing of Bank Crypto Custody Rules
Kraken has received backing from US Senator Cynthia Lummis, who has criticized the SEC for regulating by enforcement rather than establishing clear rules for the crypto industry. The exchange has referenced the SEC v. W.J. Howey Co. case, which established the Howey Test for determining if an asset is a security, and argues that the SEC has failed to prove that the assets in question qualify as securities.
This legal battle comes after a federal judge allowed the SEC’s lawsuit to proceed to trial and amid ongoing debates about the clarity of terms like “crypto asset security.” In recent developments, other crypto entities have also faced scrutiny from the SEC, including NFT platform OpenSea, which received a Wells notice in August 2024 regarding the potential classification of its NFTs as securities.
Alexander Stefanov
Reporter at CoinsPress
Alex is an experienced finance journalist and a cryptocurrency and blockchain enthusiast. With over five years of experience covering the industry, he deeply understands the complex and constantly evolving world of digital assets. His insightful and thought-provoking articles provide readers with a clear picture of the latest developments and trends in the market. His passionate approach allows him to break down complex ideas into accessible and insightful content. Follow up on his content to be up to date with the most important trends and topics - stay ahead of the curve with CoinsPress.
