The US Securities and Exchange Commission (SEC) has imposed new charges on the crypto exchange Kraken, and Senator Cynthia Lummis from Wyoming is not happy about it.
The SEC this week charged Kraken with operating its crypto trading platform as an unregistered securities exchange, broker, dealer and clearing agency.
The regulator claims that the San Francisco-based exchange has made hundreds of millions of dollars “by unlawfully facilitating the buying and selling of crypto assets.”
Gurbir S. Grewal, director of the SEC’s Division of Enforcement, said in a press release that Kraken chose profit over investor protection.
“We allege that Kraken made a business decision to reap hundreds of millions of dollars from investors rather than comply with securities laws. That decision resulted in a business model rife with conflicts of interest that put investors’ funds at risk.”
Lummis (R-Wyoming), however say The SEC’s action is another example of “ruling by enforcement.”
“Cryptoasset companies have repeatedly attempted to seek guidance from the SEC, only to be hit with enforcement actions, causing unnecessary harm to consumers. It is time for Congress to pass a regulatory framework that provides clear rules to the SEC on what is a security and what is a commodity. The Lummis-Gillibrand Responsible Financial Innovation Act will rein in the SEC and ensure that financial innovation can thrive in the United States.”
Lummis, a well-known crypto backer, has previously said she wants to pass a federal law regulating digital assets in the US early next year.
Earlier this year, Kraken, facing several SEC charges, agreed to suspend his strike services and pay a $30 million civil penalty.
Kraken co-founder Jesse Powell say the controller is now “back for seconds.”
“The message is clear: $30 million will buy you about ten months before the SEC comes along to extort you again. Lawyers can do a lot with $30 million, but the SEC knows a real fight will likely cost more than $100 million and valuable time. If you can’t afford it, get your crypto company out of America’s war zone.”
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