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Kraken cryptocurrency exchange logo is seen in this illustration taken July 28, 2022. REUTERS/Dado Ruvic/Illustration/File Photo Acquire Licensing Rights
Nov 20 (Reuters) – Kraken, one of the world’s largest cryptocurrency exchanges, was sued on Monday by the U.S. Securities and Exchange Commission, which accused it of illegally operating its trading platform without first registering with the regulator.
The lawsuit filed in San Francisco federal court is the latest step in SEC Chair Gary Gensler’s push to bring cryptocurrency under his agency’s purview, by contending that crypto assets are offered and sold as investment contracts.
Kraken did not immediately respond to requests for comment.
In its complaint against Payward Inc and Payward Ventures Inc, which together operate as Kraken, the SEC said Kraken has taken in billions of dollars in fees and trading revenue without recognizing securities laws designed to protect investors.
“Kraken has turned a blind eye to its legal responsibilities and engaged in its securities intermediary conduct without registering with the Commission, depriving investors of the disclosures and protections that registration entails,” the SEC said.
Founded in 2011, Kraken serves more than 9 million traders and institutional clients. It is backed by investors including Blockchain Capital, Digital Currency Group, Hummingbird Ventures, SkyBridge and Tribe Capital.
Reporting by Jonathan Stempel in New York; Additional reporting by Chris Prentice; Editing by Chris Reese and David Gregorio
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