Kraken Seeks to Dismiss SEC Lawsuit

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Kraken has submitted a motion to dismiss a lawsuit from the United States Securities and Exchange Commission filed in November.

Through its motion, Kraken argues that the lawsuit sets a dangerous precedent for the agency’s jurisdiction.

The company believes that the SEC’s theory has no limitations and could give them unlimited power over commerce and open the doors for private securities claims.

Additionally, crypto exchange Kraken states that the SEC’s definition of an “investment contract” could potentially turn regular assets or commodities such as sports memorabilia, trading cards, watches, and diamonds into securities.

The SEC had initially sued Kraken for allegedly operating without proper registration and having deficient internal controls, resulting in commingled customer assets and business funds.