According to Foresight News, the U.S. Securities and Exchange Commission (SEC) filed a motion with the Northern District Court of California to dismiss three defenses raised by cryptocurrency exchange Kraken in the lawsuit. The SEC believes that Kraken’s defenses on the lack of clarity of securities laws applicable to virtual assets, lack of fair notice, and the “material issue doctrine” are “legally untenable.”
The SEC sued Kraken in November 2023, alleging that it illegally operated as an unregistered securities exchange, broker, dealer, and clearing agency. The SEC said that Kraken had illegally profited hundreds of millions of dollars by facilitating the buying and selling of crypto asset securities since September 2018. By dismissing these defenses, the SEC hopes to narrow the scope of the case, save judicial resources, and prevent Kraken from repeatedly arguing the same issues at every stage of the case.