Apparently, The United States Securities and Exchange Commission is investigating Kraken, a cryptocurrency exchange, for whether it has violated the rules regarding the offering of securities.
According to a Bloomberg report on February 8, the investigation concerns certain offers that Kraken has made to US customers. A person with knowledge of the matter said that the investigation is at an advanced stage and an agreement could be reached in the coming days.
However, at the moment it is not clear which offers are being examined by the securities regulator.
When asked about the alleged probe, An SEC spokesperson told Cointelegraph: “The SEC does not comment on the existence or non-existence of a potential investigation.”.
Kraken did not immediately respond to a request for comment to discuss the situation.
Gensler said in December that his main goal for regulating crypto through 2023 was to bring crypto exchanges and lending platforms into compliance.which he said could occur through firms filing with the SEC or through enforcement actions.
Kraken CEO Dave Ripley argued in September that he saw no need to register Kraken as an exchange with the SEC because it does not offer securities.adding: “There are no tokens out there that are securities that we are interested in listing.”
SEC Chairman, Gary Gensler, has repeatedly said, however, that he views most cryptocurrencies other than bitcoin (BTC) as securities..
However, The SEC recently admitted, during an appeal hearing held on January 30 in the case of LBRY v. SEC, that the sale of LBRY (LBC) credits in the secondary market does not constitute a security.after the judge was persuaded by an argument from lawyer John Deaton noting that courts had never considered the underlying asset to be a security in similar cases.
The regulator often refers to the “Howey test” to determine what constitutes a security. The name comes from the 1946 SEC v. Howey case, which set a precedent in the US about what transactions are considered securities.
held that A transaction is classified as an investment contract -and therefore is considered a security- when there is an investment in a common enterprise with benefits obtained exclusively through the work of others.
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