The CEO of the American cryptocurrency exchange Kraken, Jesse Powell, is truly offended by the Securities and Exchange Commission (SEC). In his twitter account he laid out his own theory regarding the aims of the regulator.
I have a theory:
Regulators let the bad guys get big and blow up because it serves their agenda.
1. destroy capital/resources in the crypto ecosystem
2. burn people, deter adoption
3. give air cover to attack good actors
The bad guys are actually on-side. Good guys are the enemy. https://t.co/DZI2O8gVyO
— Jesse Powell (@jespow) February 19, 2023
“I have a theory: Regulators allow the bad guys to expand indefinitely and go bankrupt because it serves their purpose:
- destroy capital/resources in the crypto-ecosystem;
- demotivate people, restrain the spread of cryptocurrencies;
- give a reason to attack the good good guys.
The bad guys really need them. And the good guys are the enemy,” the Kraken executive wrote.
He went on to explain that the “bad guys” in the industry have a huge advantage. They accumulate users, funds and venture capital that could go to normal companies. And they can be put in jail later (as, for example, happened to Sam Bankman-Freed, the former head of FTX).
This is not the first time Powell has spoken out against US regulators. Ten days ago, Kraken settled with the SEC, agreeing to pay a $30 million fine. However, the exchange had to refuse to offer customers an important product – cryptocurrency staking. This sowed panic in the ranks of cryptocurrencies and made US crypto exchanges seriously think about whether it is worth doing business in the US at all. In the meantime, Powell figured out that the fine and shutdown of an entire line could have been avoided by simply filling out a form on the SEC website and warning users that staking rewards are earned as a result of staking itself.
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