Share:
  • Kraken has been charged with the selling of unregistered crypto staking service program.
  • The Securities and Exchange Commission settled the charges by penalizing the exchange for $30 million for four years worth of illegal activities.
  • Earlier last month, Gemini and Genesis were also charged similarly for their “Earn” program.

The Securities and Exchange Commission (SEC) has been relentless in its pursuit of crypto companies in the last few months. Under the leadership of Gary Gensler, investigations have resulted in digital asset service providers facing hundreds of millions of dollar worth of fines. The next in line is Kraken.

Kraken taken down by the SEC

The SEC announced in a Thursday press release that they had found Kraken engaging in unlawful conduct. The crypto service provider was charged for selling unregistered services of their cryptocurrency staking as a service program. Kraken was selling this service to its customers under the claim of providing an annual return on investment of around 20%..

In order to bring this to an end, Kraken agreed with the commission to immediately shut down the selling of their crypto-staking services. Along with this, the company also agreed to pay a fine of $30 million in disgorgement, prejudgment interest, and civil penalties. Commenting on the same, SEC Chair Gensler stated,

“Whether it’s through staking-as-a-service, lending, or other means, crypto intermediaries, when offering investment contracts in exchange for investors’ tokens, need to provide the proper disclosures and safeguards required by our securities laws. Today’s action should make clear to the marketplace that staking-as-a-service providers must register and provide full, fair, and truthful disclosure and investor protection.”

Furthermore, the SEC also noted that through their staking program, Kraken not only offered investors outsized returns untethered to any economic realities but also retained the right to pay them no returns at all.

SEC strikes again

This is the second case in less than a month from the Securities and Exchange Commission charging a company for an unregistered offering. In January 2022, Gemini and Genesis were charged with offering unregistered securities. 

Both companies were already fighting their war as Genisis had halted the withdrawal of the users of their “Earn” program. The companies were accused of similar charges as Kraken.


Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.

If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.

FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.

The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.

Join Telegram

Follow us on Telegram

Stay updated of all the news

Join Telegram

Recommended content


Follow us on Telegram

Stay updated of all the news

Join Telegram

Recommended Content

Editors’ Picks

Solana price nears $60 after 6% rise in a day as institutions pour millions into SOL

Solana price nears $60 after 6% rise in a day as institutions pour millions into SOL

Solana price trading at $58 is presently attempting to breach through the resistance level marked at $59. A rally is possible, given that SOL is witnessing a resurgence in bullishness. Month to date, Solana has witnessed inflows worth $40.2 million.

More Solana News

THORChain price climbs 15% as native RUNE secures self-custody wallet integration

THORChain price climbs 15% as native RUNE secures self-custody wallet integration

THORChain (RUNE) price is pumping hard, recording a 15% addition to its market value on the day, alongside a 50% rise in trading volume. When price and trading volume rise in tandem, it often points to the asset gaining attention and therefore interest among buyers.

More Rune News

Up by 96% in a week, this altcoin is likely following Solana price rally from 2021

Up by 96% in a week, this altcoin is likely following Solana price rally from 2021

Solana was known as the “Ethereum killer” when it skyrocketed back in 2021; however, it did not manage to kill the DeFi home in any way. Similarly, many altcoins have since emerged that have been denoted as Solana killers, but hardly anyone has managed to do that.

More Cryptocurrencies News

Chainlink price readies for 10% gains as LINK staking v0.2 priority migration goes live

Chainlink price readies for 10% gains as LINK staking v0.2 priority migration goes live

Chainlink (LINK) v0.2 migration has gone live, with the upgrade introducing a staking platform that ensures stakers enjoy greater flexibility. It also delivers improved security guarantees, a modular architecture, and a dynamic rewards mechanism.

More Chainlink News

Three key BTC accumulation levels before ETF approval in January 2024

Three key BTC accumulation levels before ETF approval in January 2024

Bitcoin, from a high time-frame perspective, has been in an up-only trend since the start of 2023. BTC has ignored many sell signals due to the likelihood of an Exchange-Traded Fund approval. With the holidays around the corner, falling liquidity could see BTC discounted from its current level, hovering around the $37,000 region.

Read full analysis

BTC

ETH

XRP