SEC Will Drop Lawsuit Against Kraken, Says Crypto Exchange

The Securities and Exchange Commission has “agreed in principle” to drop its lawsuit against crypto exchange Kraken, the company announced Monday.

In a blog post, the San Francisco-based exchange said that the 2023 lawsuit against the exchange had been scrapped “with no admission of wrongdoing, no penalties paid, and no changes to our business.”

“It ends a wasteful, politically motivated campaign, lifts uncertainty that stifled innovation and investment, and clears the path toward a stable, forward-thinking regulatory regime,” the announcement read.

The news comes following similar recent moves to end lawsuits or investigations against an array of crypto heavyweights, including Coinbase, Robinhood, OpenSea, and Uniswap Labs.

The SEC declined comment on the matter when reached by Decrypt early Monday.

Wall Street watchdog the SEC first sued Kraken in February 2023, alleging the exchange had violated securities laws by failing to register the offer and sale of their crypto asset staking-as-a-service program.

After the exchange settled the lawsuit by paying a $30 million fine, the regulator sued the company again in November of the same year for “operating Kraken’s crypto trading platform as an unregistered securities exchange, broker, dealer, and clearing agency.”

That lawsuit is the one the SEC has agreed in principle to dismiss, according to Kraken. It may require commissioner approval to finalize, as was the case with a suit against Coinbase that was officially dismissed last Friday.

Under the Biden administration, the SEC went after a number of top American crypto exchanges, mainly for allegedly selling unregistered securities.

But under crypto-friendly President Donald Trump, the regulator appears to be more relaxed towards the digital asset space, and has even criticized the previous management’s enforcement style.

Editor’s note: This story was updated after publication with additional detail.

Edited by Andrew Hayward