Crypto exchange Kraken has confirmed the shutdown of its crypto staking services as part of a settlement with the SEC. The news comes hours after Coinbase’s Brian Armstrong confirmed rumors surrounding SEC going after crypto-staking providers.
Kraken harpooned by the SEC?
The Kraken crypto exchange has become the latest victim of SEC’s harsh crypto regulation after agreeing to shut down its crypto staking services. According to an industry insider, the exchange agreed to stop offering those services in the US in a closed-door session on Thursday.
The official statement is yet to be made but is expected to drop at around 4 pm ET (21:00 UTC). The exchange has been offering staking services with an APY of 20%, promising to send its investors a bi-weekly return.
The exchange had been on the SEC’s radar and was on the verge of agreeing to a settlement, as reported by Bloomberg on Wednesday. However, the termination of the exchange’s crypto staking program was not a card that people saw coming; however, it’s not a wild card as people expected it to happen possibly.
Is the SEC out for crypto staking providers?
The news of Kraken being ‘forced’ to agree to abandon its crypto staking services comes as a shock but not a surprise to the crypto industry. Earlier today, Coinbase CEO Brian Armstrong leaked information that the U.S. SEC was out to get crypto-staking providers.
In his crypto thread, Armstrong explained how rumors had surfaced claiming that the industry would soon be barred from offering staking services to U.S. retail investors. He condemned the step by the SEC, but no one would have told him that crackdowns would begin in a matter of hours.
However, Armstrong’s sentiments were not shared by all, as Charles Hoskinson, Cardano co-founder, explained that crypto-staking platforms would do better. He said that some crypto staking mechanisms need more work.
Keep watching crypto.news for updates as this story develops.
Samuel Mbaki Wanjiku
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