Kraken CEO Will Not Respond to the NYAG’s “Insulting” Demands

Exchanges, Law and Regulation, News

 

Kraken co-founder Jesse Powell has responded to the inquiry launched by the New York Attorney General Office by calling it “insulting” and insists that Kraken will not respond.

New York’s Attorney General, Eric Schneiderman sent 13 letters to crypto exchanges on April 17, 2018, asking exchanges to provide details of their operations claiming it was an attempt to increase transparency in a sector in which consumers lack the “basic facts.” Kraken was one of the 13 exchanges contacted, and its CEO, Jesse Powell, has bit back saying the 34-point demand with a two-week deadline is insulting as it disrespects not only the business but the times we live in.

New York and Crypto

New York is no stranger to controversy when it comes to the crypto space. When the New York Department of Financial Services (NYDFS) introduced BitLicense in 2015, it was thought that the regulatory framework would provide too many operational burdens, and top players opted to leave New York rather than comply.

“Kraken’s Bitlicense-prompted exit from New York pays another dividend today…Ordinarily we’re happy to help the Government understand our business, however, this is not the way to go about it.” — Jesse Powell on the NYAG’s inquiry

The Kraken CEO stated that the exchange would ordinarily be happy to help the government understand their business, but the nature of the inquiry, subserviently complying to the NYAG’s demands, would send a message that similar “abuse” is ok.

Kraken will refuse to comply with NYAG’s demands

Instead, Powell suggested that it would be better for New York to take different measures to learn about the industry by talking to Kraken’s representatives who could tell them which industry groups to join and where to begin their research. “We did this once already,” said Powell. “And then you gave us Bitlicense. Why don’t you try extracting this information from those businesses actually operating in your state?”

New York has a record of deterring exchanges from operating in the area, and this has prompted legislators to consider re-evaluating BitLicense and providing alternative legislation that lessens the burden on crypto-related companies. In light of Powell’s comments on the attorney general’s inquiry, it might also need to reconsider its approach here.

Michael is an English and Creative writing graduate of Liverpool John Moore’s University, a former editor of several magazines, and a crypto-currency enthusiast. He is mostly interested in crypto-legislation and the potential of decentralized technology to change the world.

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