Australia's ASIC Wins Case Against Kraken Over Trading Violations
Australia's Federal Court has ruled that Bit Trade Pty, the operator of the Kraken crypto exchange in Australia, failed to comply with design and distribution obligations for its margin trading product. The Australian Securities and Investments Commission (ASIC) initiated civil proceedings against Bit Trade, a subsidiary of U.S. Payward Incorporated, alleging that the company did not make a target market determination for the product before offering it to customers, despite being notified of concerns.
The court found that the obligation to repay a digital asset or national currency constituted a deferred debt, classifying the product as a credit facility. This decision underscores the requirement for financial products to meet rigorous compliance standards. ASIC has indicated that it will seek financial penalties against Bit Trade at a later date. Both parties have seven days to agree on declarations and injunctions.
