The SEC has sued many companies in the crypto market: Binance, Coinbase, Ripple, LBRY and Kraken. Because LBRY and Kraken did not have the strong economic potential to pursue the lawsuit against the SEC's accusations, they surrendered. LBRY had to pay $111,614 in May 2023
[1], and Kraken also had to pay $30M in February 2023
[2].
At that time, many crypto community members did not support Kraken for accepting defeat so easily, but we can also sympathize with Kraken because they could not afford to pay $200M for the lawsuit with the SEC like what Ripple did
[3]. Everything seemed fine, until we and Kraken realized the SEC's full ambition, the SEC did not want to stop: The SEC alleges Kraken operates as an unregistered securities exchange, broker, dealer, and clearing agency for certain digital assets in Nov 2023. Obviously, despite receiving $30M, the SEC still wants to exploit Kraken's weakness instead of confronting other rich and strong companies.
This time, Kraken did not disappoint us: Kraken filed a motion to dismiss a lawsuit brought against them by the SEC on February 22, 2024.
Kraken contends that the SEC is overstepping its bounds. Kraken maintains that cryptocurrencies are not securities and that staking programs do not meet the criteria established by the Howey Test, a legal framework used to determine whether an investment qualifies as a security. Kraken argues that the SEC is attempting to regulate the crypto industry through enforcement actions rather than through clear and established rules
[4].
If Kraken prevails, it will be a blow to the SEC's attempts to exert control over the crypto market. It could also pave the way for clearer regulations specific to cryptocurrencies, fostering a more stable environment for both businesses and investors. So this time the crypto community did not let Kraken have to fight the SEC alone. The Blockchain Association, a crypto industry advocacy group, has joined the fray by filing an amicus brief in support of Kraken. They argue that the SEC is exceeding its authority and hindering innovation in the crypto space
[5].
The SEC has helped the crypto community become more connected, and helped us understand that: we cannot defend ourselves against the SEC by surrendering, the only way for us to survive is to fight together against the SEC's unreasonable accusations against the crypto market.
I am not a Kraken user, but after Kraken's courage, I love Kraken a lot more, similar to the love I have for the giant Ripple, and am willing to use Kraken's services. I will follow this SEC-Kraken lawsuit and wish Kraken victory: all for Kraken, all for the crypto future.
I want to hear your opinion about this drama:
- Is this lawsuit important for the development and future of crypto?
- What % chance do you think Kraken has of winning the lawsuit?
- Does this lawsuit motivate you to love and use Kraken's services?
References:[1]
Crypto Firm LBRY to Challenge Ruling It Violated U.S. Securities Law[2]
Crypto exchange Kraken settles with SEC for $30 million, will close U.S. staking operation[3]
Ripple will have spent $200 million fighting SEC lawsuit, CEO says[4]
The real story of the SEC’s suit against Kraken, and why Kraken is moving to dismiss the case[5]
Kraken Receives Blockchain Association’s Backing In SEC Battle
Thank MSAP.Rainbow team for suggesting this SEC-Kraken event and topic template on forums
Note:- My opinion was posted first in that topic, on Bitcointalk
- I leave the source link to avoid plagiarism accusation.
- I excluded/ included minor things from an original thread if necessary.