Breaking: SEC sues Kraken for running an unregulated exchange

The US Securities and Exchange Commission (SEC) has filed a case against the cryptocurrency exchange Kraken for infringing securities laws and commingling client assets with company assets among other things.

Based on the report, the SEC levies charges against the platform for operating as an unregistered securities exchange, broker, and dealer. 

SEC levies charges against Kraken exchange

James Seyffart, an ETF specialist with Bloomberg Intelligence, has likened the lawsuit to the one against Coinbase, with the SEC listing several digital assets it claims to be securities. There are 16 cryptos explicitly listed here, including Solana, Cardano and Algorand.

It adds to the list of crypto trading platforms that the financial regulator has clamped down against this year, including Binance and Coinbase exchanges, whose charges bordered along trading unregistered securities.

For Binance, the case may be nearing its end after the US Department of Justice demanded an ironic $4 billion in settlement fees for alleged crimes of fraud, money laundering, and sanctions violations against the platform and its CEO, Changpemg Zhao. 

This is a longstanding case, going back to August when the DOJ deliberated levying the charges and their implications to customers. 

The figure is ironic, considering the number "4" is CZ's signature when he wants to dispel FUD in the market. 

According to another legal expert and former commissioner at the SEC, John Reed Stark, Binance may not agree to a deferred prosecution agreement with the government.

If Binance agrees, it could end an investigation of the cryptocurrency exchange that has been ongoing for years.

Meanwhile, Kraken has denied the claims, committing to vigorously defend its position.