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US Crypto Staking Service (Kraken) to Be Shuttered by SEC

US Crypto Staking Service (Kraken) to Be Shuttered by SEC

By Maneul | Maneul Crypto | 12 Feb 2023

Crypto exchange Kraken will immediately end its Crypto staking-as-a-service platform for US customers and pay $30 million to settle Security and Exchange Commission (SEC) charges it offered unregistered securities, the US agency announced Thursday.

So it has already started and I think the priority here is the exchanges in America that offer Crypto Staking to retail customers. Also included in this are the two other registered companies related to Kraken, Payward Ventures, Inc and Payward Trading Ltd., they will also stop offering staking service. The SEC's complaint about Kraken is that the platform advertises its staking investment program as easy to use and offering benefits to investors that they will receive investment returns in payments that the effort comes from Kraken's work on behalf of the investors.

Because of this, Kraken will automatically unstake any assets staked by US clients except for staked Ethereum which is they can only unstake after the Ethereum Network's Shanghai upgrade. Kraken users in the US can no longer stake but non US clients are not affected. The SEC said they are doing this to protect retail investors, because in the staking service offered by Kraken as a staking service providers, they offer very little protection to users.

Coinbase (COIN) also offers staking for its customers, as do an array of decentralized protocols including Lido.


But in this news, the ones who pump there are the decentralized staking services like Lido, Rocket Pool and Frax Share. Because the target of the SEC is the centralized platforms in the US like Kraken, Coinbase and etc., so the tendency is that the stakers will just move to the decentralized platforms. Remember crypto is worldwide, so if a service is closed in a particular country, it will just move to another. Just like the Bitcoin mining ban in China before, the impact on BTC was not that big, maybe in the short term price action the impact was quite big but the mining services were just moved to other countries.

Thanks for taking the time to read this and be sure to follow me on Publish0x to be notified whenever new article is up :))

The Information contained in this article is not intended to be and does not constitute financial advice, investment advice, trading advice or any other advice.


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Hi, I like writing fun crypto articles

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