Australian Kraken operator BitTrade will pay a $5.1 million fine for failing to comply with regulatory requirements. The Australian Securities and Investments Commission has accused crypto platforms of offering credit facilities that do not comply with regulations.
The Australian operator of cryptocurrency exchange Kraken has been fined A$8 million ($5.1 million) for violating Australian regulations.
The Federal Court of Australia has fined BitTrade following a lawsuit by the Australian Securities and Investments Commission. In its order, the court said that the cryptocurrency exchange Kraken must comply with the country's cryptocurrency regulations.
The court ordered the exchange to pay A$8 million in fines for failing to comply with local regulations. In particular, Kraken recently announced the availability of licensed brokers for Australian customers.
BitTrade failed to comply with regulations
In August this year, the court ruled in favor of the Australian Securities and Investments Commission. Regulators had sued BitTrade for issuing credit facilities without following legal procedures.
ASIC argued that BitTrade did not make a target market determination, which is a requirement for investor protection. ASIC said that between October 2021 and August 2023, the company offered margin extensions to 1,100 users for failure to comply with legal requirements, resulting in losses of more than $5.2 million. said.
The market regulator's demand was for BitTrade to pay a fine worth A$20 million. Based on their claims, BitTrade set the cap at A$4 million. Penalties will follow these steps and Australian Kraken operators will have 60 days to comply with the order.
In addition, we will bear all fees and costs of legal proceedings.
Kraken also faces regulatory hurdles in the US, with the Securities and Exchange Commission (SEC) filing a lawsuit against the exchange in early November 2023.
The SEC's allegations include that Kraken offers unregistered activities and acts as an unregistered broker. In August 2024, a U.S. court denied the exchange's motion to dismiss the SEC's lawsuit.
