Kraken: authorities ' demands increased by 49% in 2019
Kraken is a historic cryptomoney exchange platform launched in 2011. The platform has just published its transparency report for 2019, in which requests from authorities have increased by 49%.
Authorities on the lookout
It is not through a tweet announcing the publication of the Annual Transparency Report that the trading platform Kraken revealed the figures concerning the requests received from the authorities.
As a result, Kraken received 710 applications in 2019, a staggering 3 applications per working day. Not surprisingly, American agencies are the most demanding and account for more than 60% of requests, accounting for 432 requests. They were followed by England with 86 requests, Germany with 44 requests, and France with a timid 17 requests.
Interestingly, the United States is far ahead, even though American users account for only 40% of platform users.
Among the most data-hungry American agencies we find the FBI with 116 requests, followed by the DEA – Drug Enforcement Administration-and its 73 requests. Surprisingly, SEC Financial Officers issued only 20 requests during the year.
In comparison with the year 2018, the number of requests increased by 49% from 475 applications 2018 710 2019. In terms of history, the number of requests made by the authorities to Kraken is constantly increasing from year to year.
Of the total requests, 28% were deemed invalid by the exchange because they did not meet local legal requirements and/or internal enforcement policy.
The cost of compliance
In an exchange with Preston Byrne on Twitter, Kraken CEO Jesse Powell revealed that handling these requests cost the exchange platform more than a million dollars in 2019.
"The cost of the compliance request service for 2019, however, was over $ 1 million, which far exceeds the work of a paralegal.”
These figures have startled various influential players in the ecosystem such as Erik Voorhees, CEO of Shapeshift, who said :
"The government spends the Kraken's money on police work.”
Unfortunately it would seem that this is simply the cost of operating in the crypto industry, and more primarily the cost of operating a crypto business in the United States. The chances that these numbers will suddenly stop rising are slim. Increasing adoption is more likely to trigger these numbers over the next few years.
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