Kraken, the world’s 10th-largest cryptocurrency exchange, has secured a dismissal of a civil lawsuit accusing it of operating as an unregistered securities exchange. The US Securities and Exchange Commission (SEC) agreed in principle to dismiss the case, which was launched by former SEC Chair Gary Gensler during his tenure.
The dismissal is seen as a significant victory for Kraken, which maintains that its operations are legitimate and compliant with laws. The company claims that cryptocurrency assets do not qualify as investment contracts subject to SEC oversight.
Kraken’s lawsuit dismissal includes no admission of wrongdoing, penalties, or changes to its business practices. It also means the SEC cannot bring the case again, with prejudice. In a statement, Kraken praised new leadership at the White House and the Commission for their role in resolving the matter.
The development comes as part of a broader trend of reduced regulatory scrutiny on cryptocurrency exchanges. Last week, the SEC ended a similar lawsuit against Coinbase and said it may resolve its civil fraud case against Justin Sun.
Kraken had been sued in November 2023, following Gensler’s push to bring cryptocurrency under the regulator’s purview. The company argues that its operations are legitimate and compliant with laws, and that the lawsuit was “wasteful” and “politically motivated.”
Source: https://finance.yahoo.com/news/kraken-says-sec-dismiss-lawsuit-153805549.html