Crypto change Kraken has filed to dismiss a November lawsuit from the Securities and Trade Fee, arguing it units a “harmful precedent” for the company’s remit.
The SEC lawsuit alleged the change commingled buyer funds and did not register as a securities change, dealer, supplier and clearing agencywith Kraken submitting its motion to dismiss the swimsuit on Feb. 22.
In an accompanying weblog post, the crypto change said:
“The SEC’s concept is that there could be an funding contract with no contract, no post-sale obligations and no interplay in any respect between the issuer and the purchaser.”
It added the company’s concept means it “has no limiting precept” and would grant the SEC “boundless authority over commerce and probably open up the floodgates to non-public securities legislation claims.”
“It might flip a broad vary of atypical belongings or commodities, like sports activities memorabilia, buying and selling playing cards, costly watches, and even diamonds, into securities.”
The SEC sued Kraken final yr, alleging it had “made tens of millions of {dollars} unlawfully facilitating the shopping for and promoting of crypto asset securities” and “intertwines the standard companies of an change, dealer, supplier, and clearing company with out having registered any of these features with the Fee as required by legislation.”
In February 2023, Kraken reached a $30 million settlement with the SEC and agreed to stop providing crypto-staking services and products to United States prospects.
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