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Cryptocurrency exchange Kraken is pushing for a jury trial in its lawsuit against the United States Securities and Exchange Commission (SEC) over alleged securities law violations.
According to documents filed with the United States District Court of Northern California on Sept. 12, Kraken demanded a jury trial and argued against the regulator’s decision to qualify 11 crypto assets as securities. The filing reads:
“The Court has rejected the SEC’s invented asset class – “crypto asset securities” – and held that these 11 digital assets are not themselves investment contracts. The SEC has pointed to no transactions where investment contracts were allegedly formed on Kraken.”
Eleven alleged securities
The 11 cryptocurrencies and tokens alleged to be securities by the SEC include Solana (SOL), Cardano (ADA), Algorand (ALGO), Cosmos Hub (ATOM), Filecoin (FIL), Flow (FLOW), Internet Computer (ICP), Decentraland (MANA), Polygon (MATIC), NEAR Protocol (NEAR), and OMG Network (OMG). Kraken’s chief legal officer Marco Santori wrote in an Aug. 23 tweet:
“Today, the Federal Court for the Northern District of California ruled, as a matter of law, that none of the tokens trading on Kraken are securities.”
Santori referred to the court allowing the lawsuit to proceed while casting doubt regarding them being securities. Santori interpreted the decision as a “significant win” for the exchange and distinguished that “a token isn’t a security, but agreements around a token could be.”
The report follows late June reports that the SEC closed its investigation into whether Ethereum (ETH), should be classified as a security. Ethereum developer Consensys announced at the time:
“Today we’re happy to announce a major win for Ethereum developers, technology providers, and industry participants: the Enforcement Division of the SEC has notified us that it is closing its investigation into Ethereum 2.0.
This means that the SEC will not bring charges alleging that sales of ETH are securities transactions.”
