Crypto Exchange Lawyer Braces for Wall Street-Style Regulation

Wall Street-esque regulation is coming to the cryptocurrency industry, so it pays to play nice. Thats the message from Marco Santori, chief legal officer of the Kraken Digital Asset Exchange.

While Coinbase head Brian Armstrong — and Santoris boss, Kraken founder and chief executive Jesse Powell — have taken an adversarial tone toward agencies such as the U.S. Securities and Exchange Commission, its clear that more stringent regulation is in the offing, Santori said.

Youre just living in a fantasy world if you dont believe that this industry is going to face heavier, more Wall Street-like regulation from governments in the U.S. and abroad, and Kraken has simply been practical about that future, Santori said on Bloombergs QuickTake Stock broadcast Thursday.

Scrutiny of the crypto industry at large has increased in recent months, as officials fret over everything from stablecoins to decentralized exchanges to lending products. Crypto firms are bracing for battle as state regulators and the SEC alike warn of more enforcement actions to come.

Kraken Digital Asset Exchange Chief Legal Officer Marco Santori discusses regulation on QuickTake Stock.


Coinbase CEO Armstrong unleashed a barrage of critical tweets this month after the SEC sent a notice to the exchange that it could be sued if it went ahead with its crypto lending project, accusing the agency of sketchy behavior. While Armstrong may have been voicing frustrations felt by many, Santori said he cant support such an approach. Coinbase ended up killing the lending program.

Ive certainly followed Brians tweets, and Ill say that look, youre just not being honest with yourself about the crypto community if a little bit of you doesnt think hes saying what a lot of people are thinking, Santori said. I cant support that kind of approach with regulators. Its never been successful historically and from our experience, weve found the SEC to be open to discussion.

–With assistance from Vildana Hajric.

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Dave Liedtka

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