The Capital Stock Exchange and Trade Commission (SEC) won a partial victory against Kraken by a Federal Court in California. The court rejected the claim that Kraken did not have the authority to regulate the Congress.
Details of the case
Judge William H. Orrick rejected Kraken’s defense of the “great question doctrine .. This doctrine argues that federal agencies cannot exercise the powers that are not explicitly given by the congress.
The court said that the SEC did not exceed its regulatory powers in this case. Orrick stressed that this doctrine is generally applied to issues that have “important economic results such as energy market or student loans.
Kraken’s defense
Kraken said that the activities of SEC did not provide sufficient warning that the activities of the securities violate the laws of securities and maintained the defense of “fair notification”.
Judge Orrick acknowledged that Kraken’s claim to be a fair declaration lack of fair notification is valid and said that the SEC should prove how the Howy Test was applied in the operations on Kraken’s platform.
Future steps
In November 2023, SEC filed a lawsuit against Kraken and claimed that the stock market operates as a non -registered securities exchange since 2018. The case is similar to SEC’s similar cases against other crypto companies.
Within the scope of the case, Payward Inc. and Payward Ventures were among the accused organizations.
This decision strengthened the authority of SEC’s authority on crypto currency regulations, and Kraken’s defense of “fair notification”. In the future, the court is expected to evaluate the evidence that the SEC should show.
Such cases may have significant effects on the future of the sector during the regulation of crypto currency markets. The elimination of uncertainties for both regulators and companies can increase the stability in the sector.
Responsibility Rejection: The information contained in this article does not contain investment advice. Investors should be aware that crypto currencies carry high volatility and thus risk and carry out their operations in line with their own research.
