SEC Seeks Dismissal of Kraken’s Defenses in Illegal Operations Case

On November 7th, COINOTAG News reported that the U.S. Securities and Exchange Commission (SEC) is seeking to dismiss several defenses put forward by Kraken in response to accusations of illicit operations by the cryptocurrency platform. The SEC’s motion, filed on November 5th, argues against Kraken’s claims surrounding the vagueness of securities laws in relation to virtual assets, emphasizing that the exchange did not receive adequate notice regarding alleged violations of these laws. Additionally, the SEC aims to invalidate Kraken’s defense based on the major questions doctrine, a legal concept from the Supreme Court that limits regulatory agencies’ ability to expand their reach without explicit legislative backing. The SEC initiated a lawsuit against Kraken in November 2023 for functioning as an unregistered securities exchange, claiming the platform has earned substantial revenues by enabling the trading of asset-backed securities since September 2018. Kraken’s prior request to dismiss the case was rejected in August.