{"id":9813,"date":"2025-01-27T08:46:42","date_gmt":"2025-01-27T08:46:42","guid":{"rendered":"https:\/\/dogewisperer.com\/?p=9813"},"modified":"2025-01-27T08:46:42","modified_gmt":"2025-01-27T08:46:42","slug":"sec-partially-wins-case-against-kraken-judge-dismisses-key-defense-on-crypto-regulation","status":"publish","type":"post","link":"https:\/\/dogewisperer.com\/?p=9813","title":{"rendered":"SEC Partially Wins Case Against Kraken, Judge Dismisses Key Defense On Crypto Regulation"},"content":{"rendered":"
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The US Securities and Exchange Commission (SEC) <\/span>achieved a partial victory<\/span> in its legal battle against Kraken as a federal judge in California dismissed one of the crypto <\/span>exchange\u2019s<\/span> central defenses. <\/span><\/p>\n

On 24 January 2025, Judge William Orrick <\/span>ruled against <\/span>Kraken\u2019s<\/span> use<\/span><\/a> of the<\/span> \u201c<\/span>major questions doctrine,<\/span>\u201d <\/span>which claims that federal agencies cannot exercise powers not explicitly granted by Congress.<\/span><\/p>\n

The SEC had filed a motion to strike three of <\/span>Kraken\u2019s<\/span> defenses in a lawsuit accusing the exchange of offering unregistered securities. <\/span><\/p>\n

EXPLORE:\u00a0<\/span>10 Coins with High Returns: Crypto Forecast 2025<\/span><\/a><\/strong><\/p>\n

Judge Rules <\/span>SEC\u2019s<\/span> Crypto Authority Aligns with Congressional Intent<\/span><\/h2>\n

Judge Orrick found that the <\/span>SEC\u2019s<\/span> authority over digital assets did not exceed Congressional intent, stating that <\/span>cryptocurrency, while<\/span> growing<\/span>, <\/span>has not yet reached the economic significance of industries like energy or student loans\u2014common examples in major questions doctrine cases.<\/span><\/p>\n

However, Judge Orrick upheld <\/span>Kraken\u2019s<\/span> \u201c<\/span>fair notice<\/span>\u201d <\/span>defense, allowing the exchange to argue that the SEC failed to provide clear guidance on whether its activities violated securities laws. <\/span><\/p>\n

He noted that Kraken had<\/span> \u201c<\/span>plausibly alleged<\/span>\u201d <\/span>it was unclear whether the Howey Test\u2014used to determine if an asset qualifies as an investment contract\u2014applied to secondary market transactions on its platform.<\/span><\/p>\n

The SEC initially filed its lawsuit in November 2023, alleging that Kraken had been operating as an unregistered securities exchange since 2018. Although Kraken sought to dismiss the case, a federal court rejected its motion in August 2024. <\/span><\/p>\n

Kraken continues to deny the <\/span>SEC\u2019s<\/span> allegations and formally disputed them in a September filing.<\/span><\/p>\n

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#Kraken<\/a>\u2019s Legal Blow: #SEC<\/a>\u2019s Grip on #Crypto<\/a> Tightens<\/p>\n

Kraken just hit a rough patch in court. A U.S. judge, William Orrick, shut down their argument that the SEC has no say over crypto. Basically, Kraken tried to use this legal move called the \u201cmajor questions doctrine,\u201d which\u2026 pic.twitter.com\/sJj4fS1z2X<\/a><\/p>\n

\u2014 Crypto-00711 (@00711Crypto) January 27, 2025<\/a><\/p>\n<\/blockquote>\n