• Commissioner Hester M. Pierce of the U.S. Securities Exchange Commission (SEC) dissented from the closure of Kraken’s staking program by the SEC, arguing that it should have been registered with the SEC as a securities offering.
• Commissioner Pierce suggested that the SEC should have set guidance on staking programs long before this situation and not use one-off enforcement actions to inform people what the law is in an emerging industry.
• The result of this settlement is that Kraken’s staking program will no longer be available in the United States, registered or not, and Commissioner Pierce labeled this decision as „paternalistic and lazy“ regulation by the SEC.
The Settlement Reached By Kraken With The SEC
On February 9th, Kraken reached a settlement with its subsidiaries Payward Ventures and Payward Trading with U.S. Securities Exchange Commission (SEC). This agreement closed down their staking program, which allows users to earn rewards for holding certain tokens for a period of time.
Commissioner Hester M Pierce’s Dissent From The Settlement
Commissioner Hester M Pierce disagreed with this decision and dissented from it in her report, arguing that such a staking program should have been registered with the SEC as a securities offering, noting that previously issued guidance could have helped to do so more efficiently. Additionally she noted that one-off enforcement actions are not an efficient nor fair way to regulate emerging industries such as cryptocurrencies and blockchain technology.
Kraken Staking Program Is Now Forbidden In The US
As part of their settlement with the SEC, Kraken is now forbidden from ever offering a staking service in the U.S., meaning their program will no longer be available in either registered or unregistered form within America’s borders.
Crypto Mom Labels This As Paternalistic Regulation By The SEC
Commissioner Pierce labelled this settlement as “paternalistic and lazy” regulation by the SEC instead of providing solutions to crypto investors within America’s borders like they should have done long before this situation happened according to her reports . This means instead of providing solutions for better investor protection they decided to just shut it down entirely without thinking through properly how to regulate these emerging markets better .
Conclusion
In conclusion , Commissioner Hester M Pierce has critiqued the recent settlement between Kraken exchange and its subsidiaries Payward Ventures and Payward Trading settled on February 9th with US Securities Exchange Commission (SEC) , calling out their decision as “paternalistic and lazy” regulation instead of creating proper guidelines for regulating new technologies such as blockchain technology .