US SEC to drop another crypto lawsuit as approach towards market changes

• SEC has agreed to relinquish its legal battle against crypto exchange Kraken
• The exchange will be paying no penalties to have the charges dropped

The United States Securities and Exchanges Commission (SEC) has made another crypto-friendly move. The commission has agreed to drop its lawsuit against one of the leading US-based crypto exchanges – Kraken. In a blog post titled “A win for fairness”, Kraken announced,

“Today marks a pivotal moment for Kraken. The SEC staff has agreed in principle to dismiss its lawsuit against Kraken with prejudice, with no admission of wrongdoing, no penalties paid and no changes to our business.”

Accused of providing crypto services without complying with rules

Filed in November 2023, the commission had accused of breaching securities law. The American crypto exchange allegedly operated as a securities exchange, broker-dealer, and clearing agency without meeting the legal requirements at least until September 2018.

Additionally, the commission claimed that the exchange mingled $33 million of customer assets and did not meet its record-keeping requirements and safeguards against conflicts of interest. Speaking about the SEC’s crypto shift, Kraken said,

“The SEC’s decision to dismiss its lawsuit against us (and many others) is more than just a legal victory — it’s a turning point for the future of crypto in the U.S. It ends a wasteful, politically motivated campaign, lifts uncertainty that stifled innovation and investment, and clears the path toward a stable, forward-thinking regulatory regime.”

Presidential change brings hope for a crypto-friendly approach

Notably, this is not the first crypto-related lawsuit the regulator has dropped. Over the past week, the SEC has forgone its legal battle against prominent crypto players, Coinbase, Gemini and Consensys. There was also a sigh of relief when the commission announced that memecoins were not securities.

The move seems to be in line with the broader shift in approach towards the crypto-markets with the US President taking the lead. Yesterday, President Donald Trump announced the creation of a US Crypto Reserve, which resulted in millions being added to the crypto markets.

The announcement also gave a massive boost to leading altcoins Cardano (ADA), Solana (SOL), and XRP, which saw its value rise by double digits within minutes. On the crypto-friendly change coming from the White House, Kraken said,

“We appreciate the new leadership both at the White House and the Commission that led to this change. Their bold and thoughtful leadership will lead to a new era of U.S. crypto innovation.”