Crypto Exchanges Face Scrutiny: Kraken Co-Founder Comments on Binance Investigation

By: Eva Baxter

Kraken co-founder Jesse Powell has criticised the U.S. Securities and Exchanges Commission's (SEC) 'convenience-oriented' approach to enforcement in the cryptocurrency industry. Powell suggests that major U.S.-based crypto businesses like Coinbase, Ripple, and Kraken have been targeted due to their convenient geographical location. He emphasized that the SEC should focus on cracking down on more blatant violators of law regardless of their offshore locations.

Binance, the largest crypto exchange by trading volume, agreed to a settlement of over $4 billion with U.S. authorities recently, after its founder, Changpeng 'CZ' Zhao, pleaded guilty to money laundering charges. This led Powell to comment that the crypto industry now 'feels a bit more fair.' The Kraken co-founder also stressed the need for the crypto industry to self-regulate and to strive for a cleaner reputation, as he believes 'each dodgy operation represents an opportunity for governments to scapegoat crypto and tighten the noose.'

Notwithstanding the scrutiny, Kraken is confident in its 'long game' and compliance-first approach to the evolving industry. Despite facing a SEC lawsuit itself for allegedly commingling customer funds, Kraken maintains that it will continue to self-police and prioritize long-term shareholders' interests.