SEC Fines Kraken $30 Million, It Does Not Consider Staking Service As Securities

The Securities and Exchange Commission (SEC) fines Payward Ventures, Inc. and Payward Trading Ltd., known as Kraken, the US based cryptocurrency exchange for not register staking service as securities. SEC accused Kraken staking service as unregistered and it does not consider Kraken staking service as securities. Kraken has been offering crypto staking since 2019. SEC said that Kraken is advertise staking service as an easy way to make money without disclosing complete information. Furthermore, SEC claimed that when investors provide tokens to staking-as-a-service providers, they lose control of those tokens and take on risks associated with those platforms, with very little protection.

Kraken agreed to settle the lawsuit by immediately end staking service to customers in the United States and paid $30 million fine in return for SEC not to further the lawsuit and does not accused Kraken as guilty. However, Kraken will continue to offer staking service to customers outside the US through another legal entity that is not subject to the US law.