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:

Tags

Decoding crypto and the markets. Daily, with Byron Gilliam.

Upcoming Events

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.

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.

Brooklyn, NY

SUN - MON, JUN. 22 - 23, 2025

Blockworks and Cracked Labs are teaming up for the third installment of the Permissionless Hackathon, happening June 22–23, 2025 in Brooklyn, NY. This is a 36-hour IRL builder sprint where developers, designers, and creatives ship real projects solving real problems across […]

recent research

Research Report Templates.png

Research

Maple Finance has successfully navigated significant market challenges through its strategic pivot to secured lending (Maple v2) and the launch of its Syrup product. Syrup has become a primary growth driver, delivering sustainable, outperforming stablecoin yields and rapidly increasing TVL. The upcoming custody-first Bitcoin staking product (istBTC) presents another significant avenue for expansion. Crucially, Maple has achieved operational profitability, a key inflection point that, combined with a fully vested token and active buyback mechanism, strengthens its investment case. While valuation metrics suggest potential undervaluation relative to peers and growth, the primary forward-looking risk identified is the long-term sustainability of its current high-take-rate collateral staking revenue model.

article-image

In 2014, Microsoft virus scanners were detecting viruses in Bitcoin software

article-image

Ledn’s Mauricio Di Bartolomeo explained how this cycle’s been different for the lender

article-image

The shorts looking for funding range from charming animated series to gritty live-action dramas

article-image

Money, it turns out, is emergent, like consciousness

article-image

Bridge flows churn in both directions as risk appetite returns

article-image

Even with an uncertain outlook thanks to tariffs, Big Tech executives are still ramping up their AI investments