30. Mai 2024

Crypto Mom Slams SEC’s Attack on Kraken’s Staking Service

• The SEC recently cracked down on Kraken’s staking service, prompting criticism from Hester Peirce (aka ‚Crypto Mom‘) who believes the SEC’s enforcement action is neither „efficient nor fair“.
• Coinbase CEO Brian Armstrong also backed up Peirce’s claims, stating that his exchange–which offers a similar product–was given „no way to register“ and that the SEC’s „offer“ was „disingenuous“.
• Staking services let customers pool their assets together into giant staking nodes which validates transactions in a blockchain network in return for rewards.

The SEC’s Enforcement Action

The Securities and Exchange Commission (SEC) recently cracked down on Kraken’s staking service, prompting criticism from Hester Peirce – aka ‘Crypto Mom’ – who believes the SEC’s enforcement action is neither “efficient nor fair”. According to Peirce, the fundamental question is not whether Kraken’s staking product should have been registered with the SEC, but whether such registration was at all possible.

Coinbase CEO Backs Up Crypto Mom

Coinbase CEO Brian Armstrong was quick to back up Commissioner Peirce’s claims on Thursday, stating that his exchange – which offers a similar product – was given “no way to register” and that the SEC’s “offer” was “disingenuous.”

What are Staking Services?

Staking services allow customers to pool their assets together into giant staking nodes which validate transactions in a blockchain network in return for rewards. This process helps secure networks and can be used as an alternative to mining cryptocurrency.

The Lack of Clear Pathway To Registration

Peirce argues that exchanges were never given a realistic pathway to registration with regards to staking-focused products due to questions surrounding specific disclosures, accounting quirks, and whether or not it would need to be registered token-by-token basis.

Conclusion

Ultimately, both Crypto Mom and Coinbase CEO Brian Armstrong agree that there needs to be more clarity around crypto-related offerings when it comes to registering them with the SEC if we want them to become mainstream.