Feb 10, 2023
Crypto Community Outraged Over SEC Charges Against Kraken
The crypto community has been thrown into an uproar after the recent charges filed by the United States Securities Exchange Commission (SEC) against crypto exchange Kraken in relation to its staking-as-a-service program.
On Feb. 9, the SEC announced that it had reached a settlement with Kraken for its failure to register the offer and sale of their crypto asset staking-as-a-service program, which it considers to be a security under its purview. Kraken has agreed to pay a $30 million fine and immediately cease offering staking services to U.S. retail investors, though they will continue to be offered offshore.
The move has been met with criticism from investors, politicians, industry executives and the crypto community alike. Adam Cochran, partner at Cinneamhain Ventures and Ethereum bull, called out SEC chief Gary Gensler, describing him as “an agent of an anti-crypto agenda” rather than a regulator, and questioning why the same standards weren’t applied to Sam Bankman-Fried and FTX.
Kristin Smith, CEO of the Blockchain Association, echoed the sentiment, arguing that this situation is a textbook example of why Congress — not the SEC — should be working with industry players to create appropriate legislation. U.S. Congressman Tom Emmer also weighed in, emphasizing the importance of staking in the crypto ecosystem and warning that the “purgatory strategy” will hurt “everyday Americans the most”.
Meanwhile, Ryan Sean Adams, founder of the Ethereum show Bankless, suggested that the SEC could have taken other measures instead of charging Kraken out of the blue. He proposed that the SEC could have mandated proof-of-reserves, required staking transparency and supported decentralized staking.
Others have questioned how Kraken could have registered with the securities regulator, as there was “no clear path” to approve crypto staking. This could also have an impact on Ethereum’s consensus layer, given that Kraken is the fourth-largest validator on Ethereum, according to on-chain metrics platform Nansen.
Not everyone was against the SEC’s decision, however. Bitcoin bull Michael Saylor agreed with Gensler’s analysis that retail investors “lose control” of their tokens when they’re delegated to external staking service providers. Meanwhile, attorney and chief policy officer of the Blockchain Association, Jake Chervinsky, noted that Kraken’s decision to settle was likely an economic decision rather than a legal one.
The SEC’s action has caused Coinbase CEO Brian Armstrong to express his concern that “regulation by enforcement” will be a “terrible path” for U.S. innovators, as they’ll be forced to push more of their services offshore.
The debate over staking services has brought to light the importance of NFTs, crypto, and web3 in the modern world. NFTs, or non-fungible tokens, have become increasingly popular in recent years, as they provide a unique and secure way to store and trade digital assets. This has opened up a whole new world of marketing opportunities, and many companies are now turning to NFT marketing agencies to help them promote their products and services.
These agencies specialize in creating and executing effective NFT marketing campaigns, such as launching NFTs on platforms like OpenSea and Rarible, running promotions on Twitter, and more. They also provide guidance on selling NFTs, helping clients optimize their campaigns for maximum reach and engagement.
The recent Kraken incident has highlighted the need for businesses to be aware of the SEC’s regulations in the crypto space. With the help of NFT marketing agencies, companies can stay up to date with the latest regulations and ensure they are compliant with all applicable laws. This will help protect businesses, investors, and consumers alike, while also allowing them to take advantage of the many opportunities offered by web3 and the crypto space.
Disclaimer: All investment or financial opinions expressed by MoonLanding Media are not recommendations and are intended for entertainment purposes only. Do your own research prior to making any kind of investment. This article has been generated based on trending topics, has not been fact checked and may contain incorrect information. Please verify all information before relying on it.
