Jesse Powell, CEO of crypto exchange Kraken scrutinized by the US regulators, expressed his regrets by urging Congress to protect the domestic crypto industry.
Kraken, the popular cryptocurrency exchange, recently reached a $30 million settlement with the US Securities and Exchange Commission (SEC), which forced it to shut down its crypto staking feature following the regulatory crackdown.
In response, Kraken’s CEO Jesse Powell expressed his regret by tweeting about it and urging Congress to protect the domestic crypto industry and US consumers who may now be forced to go offshore for services no longer available in the US.
Powell has come out again, criticizing regulators for supporting the “bad guys” in the crypto space while treating the “good guys” as enemies.
In a recent tweet, Powell explained how the blow-ups caused by the “bad guys” lead to massive capital destruction and hinder adoption, ultimately giving regulators “air cover” to attack good actors. Powell has previously accused regulators of ignoring warnings about scams and fraud.
Even Charles Hoskinson, the founder of Cardano (ADA), slammed the regulators. He tweeted:
Meanwhile, the Crypto Mom is not happy with the SEC. Hester Peirce, SEC Commissioner, has slammed the agency for going after Kraken exchange and halting its crypto staking offering after a hefty million-dollar settlement.
What’s happening with crypto regulation
Kraken’s situation is not unique. Many other crypto companies have been calling out the lack of regulatory clarity in the US and the West.
Gemini exchange CEO Cameron Winklevoss echoed Powell’s sentiments in his recent tweets, warning that the West will lose the game to the East and that the next bull run will begin in the East.
Meanwhile, Custodia Bank CEO Caitlin Long has shared Powell’s views, claiming that her warnings to regulators about crypto risks were ignored and buried in the “bowels of bureaucracy.”
Long also provided evidence to law enforcement about a crypto crime months before the company collapsed and left millions of customers in the lurch.
What will 2023 look like for crypto?
Crypto companies have long existed in a legal gray area, with legislators and government officials debating how to classify them for regulation.
Regulators have been criticized for failing to keep pace with the fast-growing crypto industry for years. But the recent collapse of FTX once considered one of the most reliable crypto firms, and the charges against its founder, Sam Bankman-Fried, have put regulators under immense pressure to act.
The SEC has levied fines and other penalties against several crypto lending firms, including Kraken, Paxos, and Terraform Labs in the past month. Many enthusiasts are concerned that the SEC may block other crypto firms from offering similar services.
In short, regulatory clarity is a significant issue in the crypto industry. While some companies, like Kraken, have been hit hard by regulatory crackdowns, others warn that regulators fail to act on warnings about crypto risks and scams.
The road ahead remains unclear, but one thing is sure: it’s going to be a bumpy ride.