Kraken CEO Tells NY Attorney General Where to Stick Their Questionnaire

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Kraken CEO Tells NY Attorney General Where to Stick Their Questionnaire

  Kraken CEO, Jesse Powell has no love lost on leaving New York, and is insulted at the New York Attorney General's detailed and short-deadlined questionnaire. On Tuesday, it was reported that New York Attorney General, Eric T. Schneiderman, would launch the Markets Integrity Initiative. This Initiative comes in the form of an inquiry/questionnaire sent out to 13 cryptocurrency exchanges in the U.S. requesting detailed information about their operations, internal methods, and ways they will protect consumer assets. The goal of this Initiative aims to increase accountability and transparency of these cryptocurrency exchanges, and to better inform enforcement agencies, investors and consumers. Schneiderman stated:

“With cryptocurrency on the rise, consumers in New York and across the country have a right to transparency and accountability when they invest their money. Yet too often, consumers don’t have the basic facts they need to assess the fairness, integrity, and security of these trading platforms...Our Virtual Markets Integrity Initiative sets out to change that, promoting the accountability and transparency in the virtual currency marketplace that investors and consumers deserve.”

While feedback about the Initiative from the exchanges was generally positive, agreeing to cooperate with the NYAG's request, not all exchanges felt the obligation to comply. Kraken, a one-time New York based exchange, now based in San Francisco, has already had a contentious relationship with New York regulations. In 2016, just months after New York demanded cryptocurrency exchanges apply for a BitLicense, Kraken decided to leave NY, for greener pastures. Now, operating outside of NY, and their state-regulations, they have been issued the Initiative questionnaire, and requested that it be completed by May 1, 2018; which is a timeframe of just a couple of weeks. Kraken's CEO, Jesse Powell, has less than amicable words for the NYAG and his request for exchanges to abide by the request:

“Kraken’s BitLicense-prompted exit from New York in 2015 pays another dividend today. When I saw this 34-point demand, with a deadline 2 weeks out, I immediately thought ‘The audacity of these guys — the entitlement, the disrespect for our business, our time! The resource diversion for this production is massive. This is going to completely blow up our roadmap!’ Then I realized that we made the right decision to get the hell out of New York three years ago and that we can dodge this bullet”

Powell insists that Kraken is generally helpful and open in working with regulators, but has little appreciation NYAG's "tone deaf" approach. Powell believes this shows a lack of respect for these exchanges, and the time necessary to fulfill their detailed requests. Powell goes on to exclaim:

“But when is it going to be enough for New York? We did all this once already, and then you gave us the BitLicense. Why don’t you try extracting this information from those businesses actually operating in your state? Kraken left New York because New York is hostile to crypto, and this ‘questionnaire’ we received today proves that New York is not only hostile to crypto, it is hostile to business”

Powell also does not appreciate the other exchanges taking a knee to NYAG's Initiative, and feels it's sending the wrong message to these regulating entities, as he stated on Twitter:

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