{"id":327642,"date":"2024-06-20T21:55:37","date_gmt":"2024-06-20T16:25:37","guid":{"rendered":"https:\/\/dripp.zone\/news\/oral-arguments-begin-heres-what-to-know-crypto-news\/"},"modified":"2024-06-20T22:00:42","modified_gmt":"2024-06-20T16:30:42","slug":"oral-arguments-begin-heres-what-to-know-crypto-news","status":"publish","type":"post","link":"https:\/\/dripp.zone\/news\/oral-arguments-begin-heres-what-to-know-crypto-news\/","title":{"rendered":"Oral Arguments Begin, Here’s What to Know – Crypto News"},"content":{"rendered":"

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Kraken\u2019s motion to dismiss the lawsuit filed by the U.S. Securities and Exchange Commission (SEC<\/a>) is scheduled for oral arguments today at 1 PM ET\/10 AM PT. <\/span><\/p>\n

The SEC accuses Kraken of being unregistered exchange and broker-dealer and asserts that 11 tokens, SOL, ADA, and ALGO, are securities.<\/span><\/p>\n

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Kraken Vs. SEC Oral Arguments Begin<\/strong><\/h2>\n

The SEC has accused Kraken<\/a> of running an unregistered securities exchange, Kraken also has been accused of operating as an unregistered broker-dealer and also of operating as an unregistered securities clearing agency. The SEC stated that 11 tokens listed on Kraken, including ADA, ALGO, ATOM, FIL, FLOW, ICP, MANA, MATIC, NEAR, OMG, and SOL, are securities. Kraken\u2019s dismissal motion relies on the Howey Test, stating that the SEC has not alleged that any securities transactions occurred on its exchange.<\/span><\/p>\n

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\ud83d\udea8NEW: Oral arguments for @krakenfx<\/a>\u2019s Motion to Dismisst against the @SECGov<\/a> begins today at 1PM ET\/10AM PT. <\/p>\n

In addition to Kraken operating as an unregistered exchange and broker-dealer, the SEC is claiming 11 tokens including $SOL<\/a>, $ADA<\/a> and $ALGO<\/a> are securities. <\/p>\n

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As\u2026 https:\/\/t.co\/YE4PBj9wxU<\/a><\/p>\n

\u2014 Eleanor Terrett (@EleanorTerrett) June 20, 2024<\/a><\/p>\n<\/blockquote>\n

Kraken had filed a reply to the SEC lawsuit, arguing that the agency\u2019s case is weak and that the suit should be dismissed. In its latest response, Kraken strongly refutes the SEC\u2019s allegations of trading unregistered securities. <\/span><\/p>\n

The exchange, therefore, said that the SEC did not correctly identify the investment contracts that are tradeable on the exchange and took issue with some of the terms used by the SEC, such as \u2018investment concept\u2019 and \u2018ecosystem\u2019, saying that these should have been \u2018investment contract\u2019 and \u2018enterprise\u2019 respectively.<\/span><\/p>\n

Similarly, Kraken<\/a> has received support for its motion to dismiss from Senator Cynthia Lummis, the Blockchain Association<\/a>, the DeFi Education Fund, the Chamber of Digital Commerce, the Investor Choice Advocates Network, Paradigm, and two administrative law scholars. These entities have filed briefs in support of Kraken\u2019s position.<\/span><\/p>\n

Comparison with Coinbase Case<\/h2>\n

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The legal community is waiting to see whether the SEC will employ the same arguments in Kraken\u2019s case as in the Coinbase<\/a> motion to dismiss the hearing. In that case, the SEC claimed that tokens\u2019 ecosystems make them fall under the Howey Test to be classified as securities. The SEC will examine this argument to determine if this is still applicable in the current situation.<\/span><\/p>\n

Moreover, Kraken relies on the SEC cases on initial coin offerings (ICOs) to back its argument. The crypto exchange notes that these cases concerned contractual rights and obligations, which is consistent with Kraken\u2019s view of investment contracts.<\/span><\/p>\n

Coinbase\u2019s Chief Legal Officer, Paul Grewal<\/a>, has earlier on accused the SEC of making contradictory arguments. In a similar case against Coinbase, the SEC again claimed that most of the supported tokens are investment contracts, using the Howey Test. As per Coinbase, the SEC\u2019s mixed signals and unequal enforcement actions have led to legal ambiguity in the digital asset market.<\/span><\/p>\n

BTC and ETH Commodity Status<\/h2>\n

The SEC has allocated commodity status to Bitcoin (BTC) and Ethereum (ETH) through the approval of spot ETFs<\/a>, although SEC Chair Gary Gensler has not publicly addressed ETH\u2019s status. <\/span><\/p>\n

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Bitcoin and Ethereum have arguably the two largest \u201cecosystems\u201d behind them, raising questions about why other tokens with significant ecosystems are classified differently.<\/span><\/p>\n

The crypto community and legal experts will closely follow today\u2019s arguments to understand how the SEC\u2019s stance on what constitutes security may evolve. This case, along with the Coinbase lawsuit, could set significant precedents for the regulatory landscape of digital assets in the United States.<\/span><\/p>\n

Read Also:<\/strong> Kraken Disputes SEC Claims, Cites Previous ICO Cases for Support<\/a><\/p>\n

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