According to a tweet by the cryptocurrency exchange from two days ago, Kraken had to deal with a significant number of law enforcement requests last year. Compared to 160 law enforcement inquiries from 2017, the company faced almost three times that amount in 2018, responding to a total of 475 inquiries. In 2016, Kraken only received 71 inquiries.
In the tweet, which included a graph of the law enforcement activity, Kraken stated, “Peek at our Compliance team’s 2018 Transparency Report. You can see why many businesses choose to block US users. Cost of handling subpoenas (regardless of licenses) is quickly becoming a barrier to entry. Inquiries up 3x [year-on-year].”
Among those countries leading the charge was the U.S. Out of the 475 inquiries, 315 came from different agencies in the U.S. government. The UK was next, but far behind, with only 61 inquiries. The month with the most inquiries was October.
The U.S. Homeland Security Investigations (HSI) agency, an arm of the Department of Homeland Security, submitted the most inquiries – 91. The FBI followed with 67 and the DEA was next with 40. There were also inquiries by the Department of Justice, the Securities and Exchange Commission, the Internal Revenue Service and local district attorneys and police department, which would be from various jurisdictions around the country.
Absent from the list were the CIA (Central Intelligence Agency) and the NSA (National Security Agency). One tweeter user responded to the post about these two, asking, “No request from CIA or NSA or they are just helping themselves?” Kraken didn’t waste any time in replying, asserting, “When you already have all the data, you don’t need to request it.”
Kraken hasn’t just been a target of law enforcement officials, but with crypto enthusiasts as well. When Bitcoin Cash (BCH) completed its hard fork last November that saw Bitcoin SV (BSV) emerge to keep the original design of crypto alive, it publicly stated that BSV was a “very bad idea” and “an extremely high risk investment.” However, it decided to support the cryptocurrency anyway, even after admitting that it had only given it a cursory review, leading many to wonder what the exchange was attempting.
Kraken is also involved in a lawsuit that was filed by United American Corp. (UAC) last year. UAC accused Kraken, along with BCH heavyweights such as Roger Ver, Bitmain and Bitcoin ABC developer Amaury Séchet, of conducting fraud and manipulating markets in conjunction with the hard fork.
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