Yesterday, Kraken Released its 2024 Transparency Report

The well-known American exchange Kraken published its 2024 Kraken Transparency Report, illustrating their commitment to compliance and regulatory requests consistent with law enforcement and their principles.

Summary

• The report by Kraken
• The year 2024
• The SEC
• Kraken’s response

The report by Kraken

The report focuses on Kraken’s transparency regarding regulatory compliance practices and adherence to legal requests throughout 2024. The exchange revealed they received data requests from law enforcement and governmental agencies in 71 countries globally.

The USA was the top country for requests, accounting for 28.6%, a figure that exceeds expectations, particularly given Kraken’s status as a bull exchange. Germany follows with over 15%, then Great Britain with over 10%. Only two other nations, Australia and Spain, surpassed 5%, while Canada, France, and Italy were below this threshold.

In total, there were 6,826 requests, with 1,951 originating from U.S. agencies. The FBI led with 614 requests, closely followed by Immigration and Customs Enforcement (ICE) at 218.

The 2024 Insights

A notable highlight is the 38.6% increase in combined data requests from global law enforcement and regulatory agencies compared to 2023. Despite the U.S. being the source of 28.6% of requests, it’s reasonable to conclude that various factors contributed to this rise, not just U.S. agencies alone.

Since 2022, the United States has intensified its scrutiny of crypto markets, especially after the collapse of the FTX exchange. Following that period, responsible parties faced consequences, but regulatory pressure continued into 2024, as reflected by Kraken’s data.

The SEC Role

The SEC, led by Gary Gensler until Donald Trump’s inauguration, serves as a central figure in U.S. governmental efforts against cryptocurrency. The Transparency Report revealed that the SEC sent just 1.9% of total requests but accounted for 37.3% of requests from U.S. regulatory bodies. The data indicates the SEC’s activity was not out of the ordinary, as the FBI’s involvement greatly surpassed it.

Kraken’s Response

Kraken reported that they responded positively to 57% of the requests received, which related to 10,369 accounts. These accounts primarily belonged to clients from the USA (34.5%), UK (8.8%), and Germany (8.5%). While this number seems considerable, it represents less than 1% of Kraken’s overall customer base.

The exchange emphasized their adherence to strict policies to comply with legal requirements while ensuring customer privacy when handling legal requests. Their Compliance Team comprises AML specialists, lawyers, former law enforcement officers, and certified professionals dedicated to monitoring compliance and safeguarding user information.