United States Securities and Exchange Commission (SEC) Commissioner Hester Pierce has published an official statement defending the Kraken exchange and saying the shutdown of operation by the SEC in the United States isn’t the right decision.
The commissioner published the statement with a title named “Kraken Down.” She believes regulation by force isn’t a good solution. She talks about the crypto industry as an innovative and emerging industry that can’t and shouldn’t be limited by forced regulations.
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The SEC shut down the Kraken operations in the United States and said it was a win for investors. Hester believes it’s not correct and doesn’t help the investors.
The first argument starts with the operation model of Kraken. Commissioner says the Kraken model helped investors stake their tokens and earn rewards while paying fees to the exchange. On the other hand, SEC believed it was a securities offering and should be regulated by securities guidelines. SEC wanted the Kraken to be registered under that commission.
At first, Kraken couldn’t be registered in that commission because no crypto-related companies currently can enter the registration pipeline in the United States.
Hester Pierce believes crypto staking is now a mature form of revenue in that industry. She says the guidelines and regulations don’t fit that form of income. In other words, laws and regulations should change, and institutions like SEC can’t force companies to follow the old guidelines.
The statement continues by saying shutting down a business because of old regulations isn’t a good answer. Many people rely on the services and will lose access to their money after the forced closures. After all, the commissioner says Kraken should start operation again, but it has to cope with regulatory institutions to find a better way to be regulated.
Transparency is the nature of the cryptocurrency industry. Commissioner believes Kraken and similar companies should follow it, but forced regulations won’t result in that.
After all, the latest statement by an SEC commissioner in defense of a crypto exchange is a good sign. We see more and more players supporting the industry and discussing more innovative regulations. Although regulations may help investors and individuals be safer when working with exchanges, the final answer is change and education.
Laws and regulations should follow the new kinds of industries and help them serve customers more transparently and efficiently. The new movements may result in better services in the long run. But the exchanges should continue to attract more users and become more mature.