Jesse Powell, the co-founder of the cryptocurrency exchange Kraken, has slammed the United States Securities and Exchange Commission (SEC) over the agency’s latest legal move.
In a tweet, Powell referred to the SEC as “USA’s top decel,” stating that the regulator has returned with another assault on America.
Kraken Co-Founder Slams US SEC
Powell’s comments come hours after the SEC sued Kraken, accusing the firm of violating several securities laws and commingling users’ funds with corporate assets.
CryptoPotato reported that the regulator charged the crypto veteran with simultaneously operating an unregistered securities exchange, broker, dealer, and clearing agency since 2018. The SEC accused Kraken of unlawfully facilitating the trading of crypto asset securities and making nine-figure profits while at it.
The securities watchdog argued that Kraken’s poor internal accounting systems put users’ funds at risk, leading to account deficiencies around their assets. The SEC found that Kraken used accounts holding customer assets to handle operational expenses.
While Kraken has disagreed with the SEC’s claims and intends to defend itself, Powell believes the agency has come to extort the crypto exchange again after receiving $30 million in settlement in February. Kraken paid the levy as a settlement for charges of its staking-as-a-service product being an unregistered security. The product was later terminated.
“The masochists haven’t been happy with the beatings they’ve been taking in NY and are shopping for a different flavor of RegDom in CA. I thought we settled all their concerns for $30m in Feb. Now they’re back for seconds?” Powell said.
Powell Urges Crypto Firms to Leave the US
The Kraken co-founder further insisted that the SEC brought new charges because it knew a “real fight” would cost valuable time and more than $100 million. Although lawyers could do a lot with $30 million, the settlement bought them about ten months before the agency returned to extort the crypto exchange again.
In addition, Powell urged crypto firms that cannot afford such issues with the SEC to get out of the “US warzone.”
Kraken faces charges similar to those of crypto exchanges Binance and Coinbase. The two companies are still caught up in legal tussles with the SEC.