Kraken legal chief dismisses SEC charges as ‘hollow,’ citing Ripple victory Kraken legal chief dismisses SEC charges as ‘hollow,’ citing Ripple victory
Marco Santori said the SEC's allegations were "made up by the agency," signaling confidence going into the legal battle ahead.
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Updated: Nov. 30, 2023 at 11:36 pm UTC
Cover art/illustration via CryptoSlate. Image includes combined content which may include AI-generated content.
Kraken, facing charges from the U.S. Securities Exchange Commission (SEC), plans to fight and respond to the complaint in court, confirmed the company’s Chief Legal Officer (CLO), Marco Santori, in a conversation with CNBC on Nov. 30.
Santori said:
“The SEC alleges that … Kraken is a exchange clearing house and broker dealer for investment contracts. None of those things exist … there’s no such thing … it’s entirely and hollow made up by the agency, and so we disagree.”
Santori added that Kraken plans to fight and respond to the complaint in court. Later in the interview, he suggested that it could take a few months to do so.
Santori also asserted that the SEC’s actions are bad policy, noting that other countries are creating legislation regulatory frameworks that are “fit for purpose” for digital asset companies. He acknowledged that, although the U.S. has not done so, members of Congress are working toward that goal.
He emphasized that Kraken does not intend to avoid regulation but rather is asking for a legal framework “that makes sense for the crypto ecosystem.”
CLO highlights Ripple victory
When asked about Kraken’s next plans for the legal case, Santori implied that Ripple‘s court win against the SEC in July set the precedent that on-exchange transactions were not considered securities transactions. He commented:
“[The U.S. crypto industry] just got [its] very first ruling on these issues in in the Ripple case … I think it it was it was well reasoned, I think most of it was levelheaded, and we think other courts are going to see it the same way.”
Kraken cited the Ripple case in passing in an earlier blog post but has not explained how it might address more specific complaints alongside the broader securities charges. Notably, the SEC alleges that Kraken commingled funds, something that Kraken says is discounted within the complaint itself.
The SEC initially filed charges against Kraken on Nov. 20. The company responded to those charges on the same day. Kraken co-founder and board chairman Jesse Powell has also commented indirectly on the matter.
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Author 
Mike Dalton
Before transitioning to crypto writing in 2018, Mike studied library and information sciences. Currently, he resides on Canada's West Coast.
Editor Editor 
Jacob Oliver
Jacob Oliver is a recovering academic and English teacher turned crypto journalist and web3 writer. He holds a Ph.D. from the University of Washington.
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In this article
The XRP Ledger is a decentralized cryptographic ledger powered by a network of peer-to-peer servers.
Kraken
Kraken is a San Francisco-based digital asset exchange in euro volume and liquidity that trades various currencies, including Canadian dollars, US dollars, British pounds, and Japanese yen.
Ripple
Ripple is a US-based technology company which develops the Ripple payment protocol and exchange network using XRP, the digital asset native to the XRP Ledger.
Jesse Powell is an expert in virtual currencies, online/international payments and fraud, as well as co-founder and former CEO of Kraken, one of the most trusted and largest Bitcoin exchanges in the world with number one EUR market share.