{"id":2792,"date":"2024-12-16T13:24:19","date_gmt":"2024-12-16T15:24:19","guid":{"rendered":"https:\/\/criptonizando.com\/en\/?p=2792"},"modified":"2024-12-16T13:24:20","modified_gmt":"2024-12-16T15:24:20","slug":"kraken-hit-with-5-1-million-fine-for-breaking-australian-regulations","status":"publish","type":"post","link":"https:\/\/criptonizando.com\/en\/news\/kraken-hit-with-5-1-million-fine-for-breaking-australian-regulations\/","title":{"rendered":"Kraken Hit With $5.1 Million Fine for Breaking Australian Regulations"},"content":{"rendered":"\n

An Australian court has fined Kraken, a digital asset exchange, $5.1 million AUD for unlawfully providing credit to over 1,100 Australian customers. The fine follows legal action by the Australian Securities and Investments Commission (ASIC).<\/p>\n\n\n\n

According to ASIC\u2019s statemen<\/a>t on Dec. 12, the penalty relates to Kraken\u2019s \u201cmargin extension\u201d product. This offering, available since October 2021, allowed users to borrow and repay funds in digital assets like bitcoin or traditional currencies like the U.S. dollar. <\/p>\n\n\n\n

However, Kraken<\/a> failed to provide a target market determination (TMD) for the product, which is a legal requirement.<\/p>\n\n\n\n

How Kraken Operator Violated DDO Rules in Australia<\/h2>\n\n\n\n

In August, an Australian Federal Court ruled that Bit Trade, Kraken\u2019s operator in the country, violated design and distribution obligations (DDO) every time it offered the product without a TMD. ASIC Chair Joe Longo stated that TMDs are crucial for protecting investors from unsuitable financial products. He noted that Kraken charged fees and interest of over $7 million USD to Australian users without assessing whether the product was appropriate.<\/p>\n\n\n\n

Longo also revealed that more than $5 million USD in losses were incurred by affected users, with one investor losing nearly $4 million. This case marks ASIC\u2019s first penalty against a digital asset exchange<\/a> for failing to meet TMD requirements. Longo emphasized that the fine should serve as a warning to other platforms still operating without full regulatory compliance.<\/p>\n\n\n\n

Justice Nicholas of the Federal Court described Kraken\u2019s non-compliance as \u201cserious and motivated by a desire to maximize revenue.\u201d He highlighted the company\u2019s inadequate compliance systems, especially since it continued offering the product after being warned. Along with the fine, the court also ordered Kraken to cover ASIC\u2019s legal costs.<\/p>\n","protected":false},"excerpt":{"rendered":"

An Australian court has fined Kraken, a digital asset exchange, $5.1 million AUD for unlawfully providing credit to over 1,100 Australian customers. The fine follows legal action by the Australian Securities and Investments Commission (ASIC). According to ASIC\u2019s statement on Dec. 12, the penalty relates to Kraken\u2019s \u201cmargin extension\u201d product. This offering, available since October […]<\/p>\n","protected":false},"author":10,"featured_media":2795,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"tpgb_global_settings":"","kia_subtitle":"","footnotes":""},"categories":[1],"tags":[40,19,41,39],"class_list":["post-2792","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-news","tag-asic","tag-bitcoin","tag-kraken","tag-u-s-dollar"],"acf":[],"yoast_head":"\nKraken Hit With $5.1 Million Fine for Breaking Australian Regulations - Criptonizando<\/title>\n<meta name=\"description\" content=\"An Australian court fined Kraken $5.1 million AUD for offering a margin lending product to Australian customers without proper regulatory\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/criptonizando.com\/en\/news\/kraken-hit-with-5-1-million-fine-for-breaking-australian-regulations\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Kraken Hit With $5.1 Million Fine for Breaking Australian Regulations - 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