Despite its latest lawsuit against Kraken, experienced crypto lawyer John Deaton believes that the U.S. SEC is worried about a pending case with Coinbase.
On Monday, the United States Securities and Exchange Commission (SEC) continued its crusade against crypto-related companies. The regulator filed a lawsuit against popular crypto exchange Kraken, alleging securities law violation and commingling of customer assets.
The latest lawsuit catches the eye, given that Kraken had already settled with the regulator for $30 million for alleged securities law violations through its staking program. However, the Kraken case also triggers attention for another reason, according to Pro XRP lawyer John Deaton.
The experienced law practitioner said it is notable that the SEC filed its case against Kraken in the United States District Court in the Northern District of California. In contrast, the SEC’s outstanding case against Coinbase was filed with the U.S. District Court for the Southern District of New York.
Deaton explains that choosing a different court for the new case indicates that the “SEC is worried.” Recall that Coinbase submitted a motion to dismiss the SEC’s lawsuit against the company in October.
The pending motion has arguments similar to the most recent case against Kraken, albeit slightly different. Hence, the move to a different court suggests that the SEC is worried that the District Court for the Southern District of New York might rule in Coinbase’s favor.
The New York court, under the purview of Judge Analisa Torres, already did so in a separate suit between the SEC and Ripple. Therefore, the agency fears a similar outcome and hopes to find better favor with North Carlifonia’s District Court.
Kraken to Fight Back
Irrespective of the court that hears the case, it is noteworthy that Kraken has expressed a willingness to “vigorously defend” itself against the latest allegations.
In doing so, Kraken would be taking in the steps of industry giants such as Ripple, Coinbase, Grayscale, and Binance, which have already been in litigation against the anti-crypto regulatory body.
It is noteworthy that Ripple and Grayscale have already enjoyed a measure of success against the SEC. Their results evidently boost the confidence of other crypto companies as the race to gain regulatory clarity for crypto in the U.S. continues.
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