SEC Partially Wins in Case Against Kraken

The US Securities and Exchange Commission has been successful in dismissing some of Kraken’s defenses, as a federal judge in California has rejected the exchange’s argument that Congress did not give the agency power over crypto.

According to Judge William Orrick’s order on January 24, he has eliminated Kraken’s defense of the “major questions doctrine,” one of three defenses that the SEC requested to be dismissed in its case against the exchange.

The SEC has accused Kraken of offering unregistered securities. Judge Orrick states that the SEC is not making a claim for a power that Congress has not reasonably been understood to have given it.

The major questions doctrine states that government agencies cannot use powers that have not been expressly delegated to them by Congress.

Other crypto companies facing lawsuits by the SEC, such as Coinbase, Ripple, and Binance, have also invoked this doctrine to argue that the regulator does not have authority over crypto.