Kraken cryptocurrency exchange says it will not comply with New York inquiry

• In contrast to many of the major cryptocurrency exchanges contacted by the New York attorney general's office, Kraken co-founder and CEO Jesse Powell says he won't comply with the information request.
• "The resource diversion for this production is massive. This is going to completely blow up our roadmap!" Powell says on Twitter.
• "Legitimate entities generally like to demonstrate to their investors that their money will be protected," says Amy Spitalnick of the NY attorney general's office.

The head of a major cryptocurrency exchange will not comply with the New York attorney general's request for information.

"The resource diversion for this production is massive. This is going to completely blow up our roadmap!" Kraken co-founder and CEO Jesse Powell said Wednesday on Twitter.

"Then I realized we made the wise decision to get the hell out of New York three years ago and that we can dodge this bullet," Powell said. "Ordinarily, we're happy to help government understand our business, however, this is not the way to go about it."



Many cryptocurrency companies such as Kraken do not operate in New York because the state requires them to have a "BitLicense" from the New York State Department of Financial Services. Coinbase, Ripple, Circle and bitFlyer USA have the license, and itBit and the Winklevoss twins' Gemini Trust have charters from the financial services department.

"Legitimate entities generally like to demonstrate to their investors that their money will be protected," Amy Spitalnick, spokeswoman for New York Attorney General Eric Schneiderman, said in a statement.

This is very basic information that any credible platform should have on hand and be willing to share with their investors," she said.

Schneiderman's office asked 13 cryptocurrency exchanges on Tuesday to complete a questionnaire by May 1 to share details on areas such as ownership, fees, trading suspensions and money laundering.

Coinbase, the Gemini Trust, bitFlyer USA and four other exchange operators that responded to CNBC's request for comment expressed support for the request.

Powell was the first dissenting voice. He added in his statement that if the attorney general's office did want to talk, "ask us for a phone call, fly yourself out to San Francisco, invite us for lunch at your office. We can tell you which industry groups to join and where to begin your research."

Powell said the last time exchanges complied with New York's request for information, they were encumbered with the BitLicense. "Kraken left New York because New York is hostile to crypto and this 'questionnaire' we received today proves that New York is not only hostile to crypto, it is hostile to business," he said.

The San Francisco-based exchange is the 12th largest by overall cryptocurrency trading volume over the last 24 hours, according to CoinMarketCap. For U.S. dollar-bitcoin trading, Kraken ranked fifth by market share, according to CryptoCompare.

Source - https://www.cnbc.com/2018/04/19/kra...it-will-not-comply-with-new-york-inquiry.html

BassTrackerBoats said:

• In contrast to many of the major cryptocurrency exchanges contacted by the New York attorney general's office, Kraken co-founder and CEO Jesse Powell says he won't comply with the information request.
• "The resource diversion for this production is massive. This is going to completely blow up our roadmap!" Powell says on Twitter.
• "Legitimate entities generally like to demonstrate to their investors that their money will be protected," says Amy Spitalnick of the NY attorney general's office.

The head of a major cryptocurrency exchange will not comply with the New York attorney general's request for information.

"The resource diversion for this production is massive. This is going to completely blow up our roadmap!" Kraken co-founder and CEO Jesse Powell said Wednesday on Twitter.

"Then I realized we made the wise decision to get the hell out of New York three years ago and that we can dodge this bullet," Powell said. "Ordinarily, we're happy to help government understand our business, however, this is not the way to go about it."

Many cryptocurrency companies such as Kraken do not operate in New York because the state requires them to have a "BitLicense" from the New York State Department of Financial Services. Coinbase, Ripple, Circle and bitFlyer USA have the license, and itBit and the Winklevoss twins' Gemini Trust have charters from the financial services department.

"Legitimate entities generally like to demonstrate to their investors that their money will be protected," Amy Spitalnick, spokeswoman for New York Attorney General Eric Schneiderman, said in a statement.

This is very basic information that any credible platform should have on hand and be willing to share with their investors," she said.

Schneiderman's office asked 13 cryptocurrency exchanges on Tuesday to complete a questionnaire by May 1 to share details on areas such as ownership, fees, trading suspensions and money laundering.

Coinbase, the Gemini Trust, bitFlyer USA and four other exchange operators that responded to CNBC's request for comment expressed support for the request.

Powell was the first dissenting voice. He added in his statement that if the attorney general's office did want to talk, "ask us for a phone call, fly yourself out to San Francisco, invite us for lunch at your office. We can tell you which industry groups to join and where to begin your research."

Powell said the last time exchanges complied with New York's request for information, they were encumbered with the BitLicense. "Kraken left New York because New York is hostile to crypto and this 'questionnaire' we received today proves that New York is not only hostile to crypto, it is hostile to business," he said.

The San Francisco-based exchange is the 12th largest by overall cryptocurrency trading volume over the last 24 hours, according to CoinMarketCap. For U.S. dollar-bitcoin trading, Kraken ranked fifth by market share, according to CryptoCompare.

Source - https://www.cnbc.com/2018/04/19/kra...it-will-not-comply-with-new-york-inquiry.html

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What's your thoughts about this ?

Are they not subjected to laws in the country they are operating from ?

krishnaverma said:

Are they not subjected to laws in the country they are operating from ?

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Sure they do, they are American. Imho one of the best and securest fiat-to-crypto exchange out there

F4lken said:

What's your thoughts about this ?

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I think that if the State of NY is trying to regulate that others will follow and eventually it will be regulated by the Federal governments as well.

Long term I think this is a good thing and industry associations will develop and self regulate to keep as much scum out as possible, or perhaps to allow as much scum in as possible, depending on one's point of view.

Powell is not looking at the big picture in my point of view as Crypto is here to stay and cooperation with government entities is going to be required in order for it to really go mainstream as there are only so many crypto hipsters out there and it needs to get out of the hipster world and into the real one.

The best (and worst) thing about cryptocurrency is the fact that it doesn't (shudnt) give a fuck about governments. USA, along with many other countries (e.g. India) are getting their ass up against it.. But then.. This is expected right?
#HODL (IF YOU WERE IDIOTIC ENUF TO INVEST)

alot of stuff going on right now. Im still HODLing

Gogol said:

The best (and worst) thing about cryptocurrency is the fact that it doesn't (shudnt) give a fuck about governments. USA, along with many other countries (e.g. India) are getting their ass up against it.. But then.. This is expected right?
#HODL (IF YOU WERE IDIOTIC ENUF TO INVEST)

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I think it should because it will be regulated at some point and working with governments as opposed to fighting them will get them more concessions in areas that are gray.

BassTrackerBoats said:

I think it should because it will be regulated at some point and working with governments as opposed to fighting them will get them more concessions in areas that are gray.

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Well technically man, nobody can regulate it until they have 51% of the blockchain. That would be a shitload of money(or is it money!! To have 51% of the blockchain, one must own that space in future) for sure. I am interested to see this. The govts also have to justify that spend.. It will be interesting. No wonder I am saving up free money in btc

Gogol said:

Well technically man, nobody can regulate it until they have 51% of the blockchain. That would be a shitload of money(or is it money!! To have 51% of the block chain, one must own that space in future) for sure. I am interested to see this. The govts also have to justify that spend.. It will be interesting. No wonder I am saving up free money in btc

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A thing are cryptos and blockchains, who cannot be regulated as well as decentralized btc to alts exchanges like cryptobridge, another things are centralized exchanges who in fact are true organizations and change fiat to money .
They can be fully regulated and should care about relationships with governments; In this point of view I share what BTB said ( crypto hipsters, lol ) .
Another possibilty is governments are very accomodant with crypto world in general to not be cutted out of the game, and entity like Kraken dont give a fuck to NYAG ( for the moment) because thinks they eventually accept their business to not be cutted out and earn from it as well.

F4lken said:

A thing are cryptos and blockchains, who cannot be regulated as well as decentralized btc to alts exchanges like cryptobridge, another things are centralized exchanges who in fact are true organizations and change fiat to money .
They can be fully regulated and should care about relationships with governments; In this point of view I share what BTB said ( crypto hipsters, lol ) .
Another possibilty is governments are very accomodant with crypto world in general to not be cutted out of the game, and entity like Kraken dont give a fuck to NYAG ( for the moment) because thinks they eventually accept their business to not be cutted out and earn from it as well.

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At this moment, let us not care about fiat!! That's what I would say. If I happen to own a lot of crypto for spending, I will use it for buying services for obvious reasons. Crypto is a baby that I personally want to see become a big one.

There will be regulation at some point or it will be banned.
You can say they can't ban BTC but they don't have to, they can make the Exchanges based in the US illegal, they can make the exchange of $$$ to BTC a criminal offence.
The fact that hardly anybody is declaring gains to the tax authorities makes it even more likely and easier for them to take action.

Asif WILSON Khan said:

There will be regulation at some point or it will be banned.
You can say they can't ban BTC but they don't have to, they can make the Exchanges based in the US illegal, they can make the exchange of $$$ to BTC a criminal offence.
The fact that hardly anybody is declaring gains to the tax authorities makes it even more likely and easier for them to take action.

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What you are saying makes sense, but only if somebody passes the crypto to fiat. I personally believe that it is gonna be a bigger game than just avoiding tax in future.
May be I am too optimistic.. Lol

Gogol said:

What you are saying makes sense, but only if somebody passes the crypto to fiat. I personally believe that it is gonna be a bigger game than just avoiding tax in future.
May be I am too optimistic.. Lol

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Without a doubt Crypto's are here to stay and are the future but I will be very surprised if governments don't pass regulations and crack down on exchanges. The average home investor will probably see regulation as a good thing if there is some form of protection in the regulation.

It really depends how we treat Crypto's are they a speculative investment instrument or a currency?

Asif WILSON Khan said:

The fact that hardly anybody is declaring gains to the tax authorities makes it even more likely and easier for them to take action.

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Take action against tax evasors, not exchanges. Instead I think they would cooperate with exchanges to retrieve all the transactions.

If I don't pay taxes the gov would fine me, not the bank

Asif WILSON Khan said:

Without a doubt Crypto's are here to stay and are the future but I will be very surprised if governments don't pass regulations and crack down on exchanges. The average home investor will probably see regulation as a good thing if there is some form of protection in the regulation.

It really depends how we treat Crypto's are they a speculative investment instrument or a currency?

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I wish them Goodluck cracking down who owns a private key lol. I don't own mine Prove me wrong (with a hammer? )

I treat crypto like the share market to be frank. as for instrument vs currency, I would go for instrument..but that's me and I am no one lol.

Edit: BTW, the fact that the common man will run away from crypto could make the value lesser, but we are talking about 100 years from now (let's say). It will eventually come down to a point. Let's think long term

Asif WILSON Khan said:

The fact that hardly anybody is declaring gains to the tax authorities makes it even more likely and easier for them to take action.

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Exactly why I think that the governments are going to regulate. Millions of dollars changing hands, people making profits on a coin going up in value is the main reason I see that happening. It will be a huge pain for them to figure out how to do this but they will figure it out.

Asif WILSON Khan said:

It really depends how we treat Crypto's are they a speculative investment instrument or a currency?

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I see it as a hybrid of the two and for sure there are other aspects I am missing which is partly why it will be hard for governments to regulate and tax.

But, you and I both know if there is money changing hands there will be taxes associated with it at some point.

If profits are generated governments want their share... it's been that way for ages.