Cryptocurrency exchange Kraken has reached a settlement agreement with the US Securities and Exchange Commission (SEC) and paid a $30 million fine for failing to register its staking-as-a-service platform. According to a press release, the exchange has also decided to shut down the staking service as part of the settlement.
Subscribe to our Telegram channel to get daily short digests about events that shape the crypto world
The SEC said that investors had "very little protection" by sending their assets to centralized exchanges that "pool" cryptocurrencies on behalf of them. SEC Chair, Gary Gensler, added that crypto staking or lending platforms "need to provide the proper disclosures and safeguards required by our securities laws."
"The complaint alleges that Kraken touts that its staking investment program offers an easy-to-use platform and benefits that derive from Kraken’s efforts on behalf of investors, including Kraken’s strategies to obtain regular investment returns and payouts," the press release reads.
In November last year, Kraken reached a settlement with Treasury's Office of Foreign Assets Control after the regulator accused the exchange of violating US sanctions against Iran. Kraken paid over $362,000 and agreed to put $100,000 into sanctions compliance.
Access more than 50 of the world's financial markets directly from your EXANTE account – including NASDAQ, London Stock Exchange and Tokyo Stock Exchange