Cryptocurrency exchange Kraken, which is facing charges from the US Securities and Exchange Commission (SEC), will fight the regulator and respond to the complaint in court.
As the company’s chief legal officer (CLO) Marco Santori told CNBC, the legal battle with the SEC could take several months.
“The SEC alleges that… Kraken is a currency clearinghouse and broker-dealer for investment contracts. None of those things exist… there is no such thing… it is entirely empty invented by the agency, and that is why we do not agree.”
Marco Santori, CLO of Kraken
According to Santori, the regulator’s actions are bad policy. He noted that other countries are creating regulatory frameworks that are “fit for purpose” for digital asset companies.
In doing so, the cryptocurrency exchange will not avoid regulation, but will instead call for a legal framework “that makes sense for the crypto ecosystem.”
According to Santori, Ripple’s victory before the SEC in July set a true precedent. During the summer court hearing, the judge admitted that the ecosystem’s native token, XRP, cannot be considered a security. Now, this may favor crypto platforms that are involved in proceedings with the regulator, believes the legal director.
“[The U.S. crypto industry] Just [its] “The first ruling on these issues in the Ripple case… I think it was well reasoned, I think most of it was sensible, and we think other courts will see it the same way.”
Marco Santori, CLO of Kraken
On November 21, the SEC accused Kraken of mixing its funds with user assets. Furthermore, the SEC also alleges that the trading platform was never registered to operate as a securities platform, broker, dealer, and clearing agency.
