A federal judge in California has granted the SEC's motion to dismiss some of Kraken's defenses after rejecting the platform's argument that Congress had not granted the SEC authority over cryptocurrencies.
Judge William Orrick ruled on Jan. 24 that Kraken's "major questions doctrine defense" could not be used as a defense in the SEC's case accusing the platform of offering unregistered securities.
According to the judge, the SEC's power in this matter falls within the reasonable limits granted to it by Congress.
The major questions doctrine provides that government agencies may not exceed the powers specifically delegated to them by Congress.
Judge Orrick noted in his ruling that cases invoking the substantial question doctrine could have a significant impact on the US economy.