Trezor home
Trezor home

Crypto Exchange Kraken Faces US SEC Probe

red image of kraken exchange logo
Trezor home

According to a Bloomberg report published on 8 February, renowned crypto exchange Kraken faces a probe by the US SEC (Securities and Exchange Commission) over unregistered securities.

The probe is related to some offerings the cryptocurrency exchange has made to US clients. According to someone familiar with the investigation who wishes to remain unidentified, proceedings are currently at an advanced stage and settlement could come in the following days.

It is currently unclear which offerings or tokens are under the microscope.

Moni Talks reached out to the SEC for further comments on the probe, but, as is the norm, the SEC does not comment on the status of a 'potentially existing' investigation.

Trezor home

What does the probe mean for crypto exchange Kraken and the industry?

At the time of writing, we are unsure of the magnitude of the investigation. That said, if Kraken is guilty of breaching securities laws, the ramifications for the cryptocurrency exchange and the industry at large could be significant, especially after the FTX saga of Q4 2022.

If Kraken settles with the SEC, this could pressure other cryptocurrency firms to discuss deals with the agency. In December 2022, SEC Chair Gary Gensler commented on the runway for crypto firms to register with the regulator getting shorter.

The SEC is firm with its stance - most of the tokens offered by crypto firms are securities and should be subject to the rules of the regulator. It should be noted that all SEC investigations DO NOT lead to enforcement action. Instead, individuals or firms may have to pay a fine and/or face other penalties.


Source: CoinMarketCap

With a trading volume of nearly $640M at the time of writing, US-based Kraken is the third-largest cryptocurrency exchange. This statistic alone indicates that any potential legal ramifications on the cryptocurrency trading platform could have a telling impact on the industry.

This is not the first probe Kraken has faced. In 2022, Kraken paid a fine of more than $360,000 and invested $100,000 in sanctions compliance over allegations that the cryptocurrency trading platform violated US sanctions against Iran. The settlement was reached with the US Treasury’s Office of Foreign Assets Control (OFAC).

Global crypto regulations will come into effect soon, whether you like it or not, and several countries are actively working towards this.

Trezor home
surajdeep singh

Author: Surajdeep Singh

Surajdeep Singh has been working in the tech sphere as a marketing guru and journalist for over 6 years, with his speciality laying in blockchain and Web3. He has donned several hats in marketing and journalism over the years and worked with many reputable brands. Feel free to reach out to him on LinkedIn!

This site uses cookies, please see ourCookie Policyfor more information.