Regulators Are To Blame For All The Crisis In Crypto, Says Kraken CEO

Jesse Powell, co-founder and CEO of Kraken, a cryptocurrency exchange, thinks users should blame regulators for the ongoing cryptocurrency crises.

Kraken CEO: Are Regulators Going To Kill Cryptocurrency?

Responding to a Feb. 20 tweet, Jesse suggested that the regulators took a step back in letting the bad guys go big before blowing up because, in his opinion, “it serves their agenda.”

Ecosystem resources and capital are destroyed whenever such a panic occurs in the cryptocurrency. At the same time, people are being burned, which is holding back adoption, which is a negative for the industry. What’s more, Jesse notes that regulators have “good air cover” when good players in the field are attacked.

The crypto industry is still in its infancy, although the underlying technology has been around since 2009 when Bitcoin was first launched.

Bitcoin price February 20
Bitcoin price February 20 | Source: BTCUSDT on Binance, TradingView

However, despite the time, cryptocurrencies have become widespread after the ICO hysteria in 2017-2018. There have been several innovations in fundraising over the past five years, one of the highlights being the launch of DeFi protocols and NFT projects.

Regulators tasked with creating a fair environment and protecting investors have been slow to adjust to this explosion of tokens and projects, according to Powell and other experts. Policy makers have yet to develop drafts that clearly define the majority of cryptocurrencies in most jurisdictions.

SEC crackdown on good and bad projects

For context, in the United States, the Securities and Exchange Commission (SEC) only recognizes bitcoin as a commodity. On several occasions, SEC officials have officially stated that most cryptocurrencies are unregistered securities.

Ripple Inc., a blockchain company, is suing the SEC after its executives were sued for selling XRP, which the regulator insisted was being offered to investors as a non-registered security.

Last week, the SEC sent BUSD issuer Paxos a Wells notice stating that the stablecoin is a non-registered security.

Jesse wants to change the lack of clear rules and regulations, especially in the United States, which is suppressing the crypto industry, including exchanges and stablecoin issuers.

He argues that regulators should take a “pre-emptive” stance rather than wait for the crisis to kick in, turning good crypto projects into enemies.

Kraken’s CEO adds that bad companies are already operating with “enormous competitive advantages” as they suck up users, revenue and venture capital that would otherwise go to good projects.

Kraken recently settled with the SEC for $30 million, under an agreement that they shut down their crypto staking service in the United States.

Function image from Canva, chart from TradingView

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