Crypto Industry Has More Appetite To Fight: Kraken Exec

Coinbase and Kraken are confident tokens listed on their platforms are not securities, regulator leaders from the exchanges said

article-image

Artwork by Axel Rangel, modified by Blockworks

share

The SEC is after crypto, but Coinbase and Kraken say their operations are sound. 

As enforcement actions alleging unregistered securities offerings heat up in the US, Coinbase and Kraken are confident tokens listed on their platforms are not securities, regulatory leaders from the exchanges said Thursday. 

“We’re comfortable that the products we are offering in the US are not securities,” Scott Bauguess, vice president of global regulatory policy at Coinbase, said during a panel discussion at the Milken Institute Future of Digital Assets Symposium in Washington, DC, Thursday. 

The tokens on Coinbase do not behave like securities, Bauguess added, pointing to the lack of dividends and residual interest. But, he said, even if all the tokens were ruled securities, Coinbase could make it work. 

“What would we do? The simple answer is it could be done,” Bauguess said. “With sensible rules.”

Jonanthan Jachym, global head of policy at Kraken, agreed. When it comes to advancing exchange policy, leaders need to think about how to adjust current laws to fit crypto, he added. 

“Disclosures, market integrity, conflict of interest rules…it’s not reinventing the wheel, these policies have existed for a long time, but there are nuances [with this technology,]” Jachym added. 

Jachym’s comments come shortly after the exchange opted to settle with the SEC for $30 million and an agreement to discontinue its staking product. Even though Kraken decided against a court battle, Jachym said the industry is ready to fight. 

“Appetitie to litigate in this industry is as high as its ever been,” he said. 

Settlements, Ledger’s global head of policy Seth Hertlein, said cannot create a precedent for future disputes, but a court case could change the game. 

“[Kraken’s] settlement did not create any new rules or law in the United States, and it’s not binding on anyone besides Kraken, who agreed to it,” Hertlein said. “The scope is actually quite limited.”

Kraken’s move was strategic, Jachym said, and the exchange looks forward to more guidance around staking. 

“That decision to settle was a business decision,” Jachym said. “A $30 million penalty is about 3% of our business right now. Due to the settlement terms, we are not able to directly discuss or debate the contents of the settlement.”


Get the news in your inbox. Explore Blockworks newsletters:

  • Blockworks Daily: The newsletter that helps thousands of investors understand crypto and the markets, by Byron Gilliam.
  • Empire: Start your morning with the top news and analysis to inform your day in crypto.
  • Forward Guidance: Reporting and analysis on the growing intersection of crypto and macroeconomics, policy and finance.
  • 0xResearch: Alpha directly in your inbox. Market highlights, data, degen trade ideas, governance updates, token performance and more.
  • Lightspeed: Built for Solana investors, developers and community members. The latest from one of crypto’s hottest networks.
  • The Drop: For crypto collectors and traders, covering apps, games, memes and more.
  • Supply Shock: Tracking Bitcoin’s rise from internet plaything worth less than a penny to global phenomenon disrupting money as we know it.
Tags

Upcoming Events

Industry City | Brooklyn, NY

TUES - THURS, JUNE 24 - 26, 2025

Permissionless IV serves as the definitive gathering for crypto’s technical founders, developers, and builders to come together and create the future.If you’re ready to shape the future of crypto, Permissionless IV is where it happens.

Old Billingsgate

Mon - Wed, October 13 - 15, 2025

Blockworks’ Digital Asset Summit (DAS) will feature conversations between the builders, allocators, and legislators who will shape the trajectory of the digital asset ecosystem in the US and abroad.

recent research

morpho 2 graphic.png

Research

Utilizing a ‘DeFi Mullet’ approach, Coinbase’s Bitcoin-backed loans integration with Morpho demonstrates a powerful blueprint for CEXs to monetize dormant assets by expanding adoption of wrapped products (cbBTC, USDC) while also supporting native and/or preferred DeFi ecosystems (Base) which can further lead to downstream growth in onchain liquidity and increased utilization of the related assets.

article-image

The network is at a “pivotal juncture,” Blockworks Research’s Marc-Thomas Arjoon said

article-image

Altcoin trade volume has returned to pre-FTX levels, but with a shrinking pool of market leaders

article-image

Solana Foundation’s former head of strategy proposes increasing the disinflation rate

article-image

With much of the bitcoin mining supply chain based in Asia, US-based operations now face higher equipment prices

article-image

Anticipating an economic downturn, venture firms may be less likely to invest

article-image

Trump’s tariffs may have potentially significant impacts on GDP, household spending and food prices — if they hold