Kraken co-founder Jesse Powell has come out swinging after the U.S. Securities and Exchange Commission filed charges against the exchange, dubbing the regulator the “USA’s top decel.”
In a tweet, Powell argued that the SEC is “back with another assault on America,” accusing it of “shopping for a different flavor of RegDom in CA” after suffering legal “beatings” in New York.
The term “decel” is used by tech enthusiasts to dismiss “doomsayers” who they see as standing in the way of progress.
The SEC accused Kraken of operating as an “unregistered securities exchange, broker, dealer, and clearing agency,” and alleged that it had commingled customer assets with company funds, including paying its own bills from an account holding customer funds.
The charges come mere months after Kraken paid a $30 million fine to settle earlier SEC charges, and agreed to halt its staking service in the U.S.
“I thought we settled all their concerns for $30m in Feb. Now they’re back for seconds?” Powell said, adding that, “Message is clear: $30m buys you about 10 months before the SEC comes around to extort you again.”
He argued that “Lawyers can do a lot with $30m but the SEC knows that a real fight will likely cost $100m+, and valuable time,” adding, “If you can’t afford it, get your crypto company out of the US warzone.”
In its complaint, the SEC alleged that cryptocurrencies including Cardano (ADA), Algorand (ALGO), Cosmos (ATOM) and Solana (SOL) are securites.
Kraken responded that it disagreed with the SEC’s assertions and plans to “vigorously defend our position.”
Powell served as CEO of Kraken until he stepped down in 2022 to become chairman of the exchange’s board of directors, stating that he planned to focus on, “spending more of my time on the company’s products, user experience and broader industry advocacy.”
After Kraken settled the previous SEC charges in February 2023, Powell took to Twitter to claim that the regulator had provided, “zero guidance, zero collaboration, zero interest in helping anyone develop a compliant product.”
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