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Jesse Powell, Managing Director of Kraken Bitcoin Exchange© 2014 Bloomberg Finance LP
During the latest escalation of a war of words, the Attorney General of New York State warned that Kraken's cryptocurrency exchange could break the law.
In a long report on the "integrity" of global cryptocurrency trade, newly appointed general attorney Barbara Underwood ranked San Francisco-based Kraken among multiple exchanges that could operate "illegally".
However, following a passionate and very public refusal by the Kraken CEO to participate in the report, the warning seems to be based as much on the lack of access as on any legitimate concern.
According to the report:
"Customers should be aware that platforms that have refused to participate in the OAG initiative (Binance, Gate.io, Huobi and Kraken) can not disclose all types of orders offered to certain traders, some of whom may prefer these traders at the expense of others, and that the commercial performance of other customers on these sites could be adversely affected. "
A New York lawyer's representative said the bureau had sent three of these platforms – Binance, Gate.io and Kraken – to the New York State Department of Financial Services "for operating illegally in New York. York ".
While Kraken is probably the best-known trade with US users, with a daily volume of $ 133 million, Binance is the largest market in the world, with a daily volume of $ 1 billion, and a volume of 670 million dollars, according to CoinMarketCap data.
The report, officially titled the Virtual Market Integrity Initiative report, included the results of nine other exchanges, including Bitfinex (operated by iFinex Inc.), BitFlyer USA, Inc., Bitstamp, Ltd., Bittrex, Inc., Gemini Trust Company, itBit (operated by Paxos Trust Company) and Poloniex (owned by Circle Internet Financial Limited).
The report focused on five areas: where markets do business, their trade policies, how they manage conflicts of interest, security and how they access consumer funds. After each section, the Attorney General warned that the aforementioned exchanges were not taken into account in the findings.
In the case of Kraken, one of the oldest on the list, the reason for his refusal to participate was very clear. In August 2015, Kraken formally left the jurisdiction of New York citing concerns about the cost and scale of the BitLicense expansion, many of which argued that it was even traditional financial regulation.
"It's a creature so cruel, so cruel that even Kraken has neither the courage nor the strength to face his big, sharp teeth," Kraken wrote at the time.
In April 2018, Kraken's founder, Jesse Powell, publicly refused to answer questions from the Attorney General of New York. "Having the requested information" in hand "is not the same as having the resources to compile it carefully as part of the application, within two weeks", has-it- he declares. tweeted.
Despite Kraken's refusal to participate or perhaps because of this, the report concluded:
"Whether or not customers need to trade virtual currencies depends on the needs and experience of the customer. In general, however, customers would be well advised to avoid platforms that can not satisfactorily answer the questions posed in this report. "
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Jesse Powell, Managing Director of Kraken Bitcoin Exchange© 2014 Bloomberg Finance LP
During the latest escalation of a war of words, the Attorney General of New York State warned that Kraken's cryptocurrency exchange could break the law.
In a long report on the "integrity" of global cryptocurrency trade, newly appointed general attorney Barbara Underwood ranked San Francisco-based Kraken among multiple exchanges that could operate "illegally".
However, following a passionate and very public refusal by the Kraken CEO to participate in the report, the warning seems to be based as much on the lack of access as on any legitimate concern.
According to the report:
"Customers should be aware that platforms that have refused to participate in the OAG initiative (Binance, Gate.io, Huobi and Kraken) can not disclose all types of orders offered to certain traders, some of whom may prefer these traders at the expense of others, and that the commercial performance of other customers on these sites could be adversely affected. "
A New York lawyer's representative said the bureau had sent three of these platforms – Binance, Gate.io and Kraken – to the New York State Department of Financial Services "for operating illegally in New York. York ".
While Kraken is probably the best-known trade with US users, with a daily volume of $ 133 million, Binance is the largest market in the world, with a daily volume of $ 1 billion, and a volume of 670 million dollars, according to CoinMarketCap data.
The report, officially titled the Virtual Market Integrity Initiative report, included the results of nine other exchanges, including Bitfinex (operated by iFinex Inc.), BitFlyer USA, Inc., Bitstamp, Ltd., Bittrex, Inc., Gemini Trust Company, itBit (operated by Paxos Trust Company) and Poloniex (owned by Circle Internet Financial Limited).
The report focused on five areas: where markets do business, their trade policies, how they manage conflicts of interest, security and how they access consumer funds. After each section, the Attorney General warned that the aforementioned exchanges were not taken into account in the findings.
In the case of Kraken, one of the oldest on the list, the reason for his refusal to participate was very clear. In August 2015, Kraken formally left the jurisdiction of New York citing concerns about the cost and scale of the BitLicense expansion, many of which argued that it was even traditional financial regulation.
"It's a creature so cruel, so cruel that even Kraken has neither the courage nor the strength to face his big, sharp teeth," Kraken wrote at the time.
In April 2018, Kraken's founder, Jesse Powell, publicly refused to answer questions from the Attorney General of New York. "Having the requested information" in hand "is not the same as having the resources to compile it carefully as part of the application, within two weeks", has-it- he declares. tweeted.
Despite Kraken's refusal to participate or perhaps because of this, the report concluded:
"Whether or not customers need to trade virtual currencies depends on the needs and experience of the customer. In general, however, customers would be well advised to avoid platforms that can not satisfactorily answer the questions posed in this report. "
