Federal authorities have concluded two significant probes involving Kraken and its leadership without filing formal charges, signaling a potential shift in regulatory approaches toward the cryptocurrency sector.
The Federal Bureau of Investigation (FBI) has ended its inquiry into Kraken co-founder Jesse Powell and returned all seized items, according to known facts. The investigation, initiated in 2022, focused on allegations of cyberstalking but concluded without charges being filed against Powell.
Simultaneously, the US Securities and Exchange Commission (SEC) has dropped its 2023 civil case against Kraken itself. That lawsuit alleged Kraken operated as an unregistered securities exchange, broker, dealer, and clearing agency. The decision to dismiss the case is viewed as reflecting a broader reconsideration of enforcement strategies within the SEC, particularly under the direction of Acting Chair Mark Uyeda, balancing oversight with industry development.
These developments underscore the evolving regulatory environment for cryptocurrency firms. The closure of both the FBI’s investigation into Powell (noted as unrelated to Kraken’s business operations) and the SEC’s civil action against the exchange may contribute significantly to greater regulatory clarity and operational stability throughout the crypto industry, providing renewed focus for compliant growth.
Powell has consistently maintained his stance denying the allegations under FBI investigation.