Kraken Crypto Exchange Probed by SEC Over Offering Unregulated Securities

Kraken, one of the world's largest volume cryptocurrency exchanges, is being scrutinized by the US Securities and Exchange Commission (sec). This is not the first time crypto exchange has encountered problems with regulators. 

Cryptocurrency kraken came under securities and currency board (sec) radar. The regulator checks to see if this exchange has offered non-registered securities to U.S. customers.

Bloomberg in the month of February. 9 stated that the investigation was at an "advanced stage", although the details remain unclear, a resolution may soon be reached. 

Risks related to the negotiation of non-registered securities.

Securities are considered higher risk because they are not subject to the same level of regulatory oversight as other financial instruments. Nevertheless, Dave Ripley, the new CEO at Kraken, wouldn’t register with the SEC despite calls from chairman Gary Gensler for crypto platforms to do so. , the largest crypto exchange, has also  repercussions for trading unregistered securities. 

Once the investigation is completed and the Surete publishes its conclusions, it is easier to say the result. The investigation could result in fines, penalties or other penalties if the Sec becomes aware of breaches of securities legislation.

Kraken is currently the third largest crypto exchange by volume on CoinMarketCap. It goes without saying that the continuing investigation of regulatory agencies is not a good image for the industry. As recently as two months ago, Kraken arranged with ofac for violations of sanctions and paid a penalty of $362,000. 

Difficult macroeconomic circumstances.

The crypto market suffered a severe winter last year when institutions like FTX collapsed. This affected many exchanges, including Kraken. The platform recently laid off 30% of its workforce. 

Supposedly, the cut was independent of events such as the FTX implosion, according to the head of strategy in Kraken.