- Kraken has been fined $1.25 million for offering margin trading options to U.S. users
- Kraken accepted the fine without admitting guilt
- Enforcement action had been predicted to hit around this time
OG cryptocurrency exchange Kraken has been hit with a $1.25 million fine by the Commodity Futures Trading Commission (CFTC) over illegally offering margin trading options to U.S. customers. The enforcement action comes two days before the end of the CFTC’s fiscal year and fits neatly within the predicted timeframe given by crypto lawyer Jake Chervinsky for such action. If this is the only action the CFTC takes before the end of its fiscal year then the crypto space will breathe a sigh of relief given the supposed investigations into Uniswap and Binance.
Kraken Not Registered for Margin Trading
Kraken was handed the $1.25 million yesterday by the CFTC who ruled that between June 2020 and July 2021 the exchange allowed “Margined, leveraged or financed digital asset trading” to retail U.S. customers without being “properly registered and regulated” according to Vincent McGonagle, the CFTC acting enforcement director. Kraken accepted the settlement without admitting guilt, issuing a statement on the matter:
We appreciate that today’s settlement acknowledges our cooperation and engagement on the issue. We are committed to working with regulators to try to ensure the rules governing digital assets create a level playing field globally — one that allows the crypto space in the U.S. to flourish, while protecting the interests of individuals and the integrity of the industry.
Crypto May Have Got Off Lightly
The news will be something of a relief to the crypto community who have experienced similar action around this time over the last two years – last year BitMEX was hit with CFTC charges while the year before it was the turn of EOS.io. If a Kraken fine turns out to be the best the CFTC can come up with this year then the crypto community has got off lightly with Binance and Uniswap both supposedly under investigation by the CFTC.