tl;dr
In a surprising development, eight state attorneys general filed an amicus brief challenging the Securities and Exchange Commission's "regulatory power grab" in the ongoing legal battle between Kraken and the SEC. Kraken's Chief Legal Officer, Marco Santori, highlighted the inconsistency in the SEC'...
In a surprising development, eight state attorneys general filed an amicus brief challenging the Securities and Exchange Commission's "regulatory power grab" in the ongoing legal battle between Kraken and the SEC. Kraken's Chief Legal Officer, Marco Santori, highlighted the inconsistency in the SEC's definition of investment contracts. The attorneys general argued that the SEC's expanded authority into non-securities transactions puts consumers at risk and alters traditionally consumer-protective laws.
Kraken has been advocating for Congress’s intervention in the SEC’s autocratic power over the crypto sector. Though the SEC later accused the company of operating as an “unregistered securities exchange, broker, dealer, and clearing agency,” Kraken fought against them, requesting the court to dismiss the lawsuit. The company CEO, Dave Ripley, criticized the regulator’s claims as “factually incorrect, contrary to law, and the wrong way to create policy in the United States.” Santori, in his post, pointed out the inconsistency in the agency’s claims that contradict themselves. Initially, they argued that a token is an “investment contract” and, therefore, a “security.” Later, they modified their statement, arguing that the token isn’t an investment contract but a code, and the token is “sold” as an investment contract. Their final claim contradicted the previous claims, arguing that the token “represents” an investment contract.
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