Why Kraken Demands a Jury Trial in Its Legal Battle with the SEC

• Kraken is seeking a jury trial after the SEC accused it of operating an unregistered securities exchange.
• SEC has accused Kraken of listing unregistered securities of several major cryptocurrencies, including Solana, Cardano, and NEAR Protocol.
• The consequences of this legal trial might significantly impact the development of the rest of the cryptocurrency market.

Kraken cryptocurrency exchange demands a jury trial in a legal dispute with the U. S. Securities and Exchange Commission. This is because a federal court declined to dismiss a lawsuit accusing Kraken of providing securities services without proper licensing. In particular, the case raises important questions regarding the cryptocurrency industry.

SEC’s Allegations and Kraken’s Response

Specifically, the SEC stated that Kraken operated as an unregistered securities exchange, broker, dealer, and clearing agency. Notably, the regulatory body listed several popular cryptocurrencies as unregistered securities, including Solana (SOL), Cardano (ADA), Internet Computer (ICP), and NEAR Protocol (NEAR).

But instead of denying these claims, Kraken continues to make these allegations. The exchange has submitted a new legal document stating it has engaged in no illegality. The filing systematically addresses each of the matters that the SEC has accused the company of and provides 18 extra points in its defense. This all-encompassing refutation points out Kraken’s willingness to fight the SEC allegations to the bitter end.

Implications for the Cryptocurrency Industry

The impact of this legal fight at this stage could influence the rest of the crypto market. However, if the court stands with the SEC, it may establish a precedent that other exchanges may need to follow, leading to them changing their operations and registering with the SEC. This could lead to enhanced risks of regulatory action and compliance expenses for cryptocurrency trading platforms.

On the other hand, if Kraken wins the case, it may cast doubt on the ability of the SEC to regulate specific cryptocurrencies as securities. This could offer more specificity and autonomy for the industry without worrying about being shut down or penalized by regulators.

While this legal drama plays out, it creates an awareness of the ever-changing dynamic of regulations in the crypto markets and the constant reality of the lack of a clear understanding of the classification of digital assets and operations of the exchange.

Personal Note From MEXC Team

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