Lawyers for Kraken and the US SEC presented their arguments to the court on whether digital assets on the exchange should be considered securities. 🏛️ The judge suggested he was "inclined to reject" the motion to dismiss the case, saying it was "possible" the digital assets were offered and traded as investment contracts on a crypto exchange.
Kraken's lawyers defended their position, citing significant differences in the pending cases between the SEC and Terraform Labs and Telegram.
The SEC views Kraken as an “ecosystem” in which tokens were sold as investment contracts, which, in their opinion, makes them securities under the Howey test.
The judge did not rule on the motion to terminate at the hearing, but suggested that after arguments from Kraken and the SEC, he was still inclined to reject it.