Big News: Kraken Lawsuit Dismissed by SEC, Ripple Still Stands in Legal Crosshairs

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Kraken has announced that the U.S. Securities and Exchange Commission (SEC) has agreed to dismiss its lawsuit against the crypto exchange with prejudice. The SEC’s decision means no penalties, no changes to Kraken’s business operations, and no admission of wrongdoing.  The SEC has closed probes into major companies like OpenSea, Gemini, and Robinhood but continues to investigate others, including Ripple.

A Major Legal Victory for Kraken

The SEC filed a lawsuit in November 2023, accusing kraken

kraken
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Centralised ExchangeDecentralised Exchange

of mishandling customer funds and operating as an unregistered securities broker. Instead of settling, Kraken chose to fight the charges. A federal judge initially ruled that the SEC had a plausible case, which led to the case heading to trial. However, the SEC has now decided to drop the charges after reaching an agreement with Kraken. Pending approval from the SEC’s Commissioners, the case will be officially closed.

“This dismissal lifts that cloud of uncertainty. It reaffirms that businesses like Kraken, which prioritize compliance and consumer protection, should not be subject to arbitrary legal battles,”

the company stated.

A Turning Point for Crypto in the U.S.

Kraken celebrated the SEC’s decision, calling it more than just a legal victory. The company described the move as a turning point for the future of crypto regulation in the U.S. The SEC’s decision, Kraken stated, puts an end to what they called a politically motivated campaign, lifting the uncertainty that has hindered innovation and investment in the industry.

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SEC’s Changing Approach to Crypto Enforcement

Kraken’s win comes as the SEC, under new leadership, shifts away from the aggressive enforcement tactics that characterized the tenure of former SEC Chair gary gensler

gary gensler

Gary Gensler is a pioneer and the current chair of the U.S. Securities and Exchange Commission. He has extensive experience that spans Wall Street, government regulation, and an angel teaching about cryptocurrencies and blockchain at MIT. Gary S. Gensler was on born October 18, 1957, in Baltimore, Maryland.He graduated from Pikesville High School in 1975, where he was later given a Distinguished Alumnus award. He also earned a degree in economics.Gensler served in the United States Department of the Treasury as Assistant Secretary for Financial Markets from 1997 to 1999, then as Undersecretary for Domestic Finance from 1999 to 2001He has expressed his desire to present crypto-related approach changes later on that include token commitments, decentralized finance, stablecoins, guardianship, exchange-traded resources, and advancing stages.

Chairman

The new leadership has expressed a commitment to developing clear and fair regulations for the cryptocurrency industry, rather than relying on “regulation by enforcement.”