The US Federal Bureau of Investigation (FBI) has completed its investigation into Kraken crypto exchange co-founder Jesse Powell, returning the devices they had seized during their inquiry. This is reported by Fortune, citing sources.
The charges were not related to the crypto industry
The investigation centered on allegations of hacking and cyberstalking involving the Verge Center for the Arts (VCA), a nonprofit organization Powell helped found in 2008. Importantly, the case was unrelated to Powell’s work at Kraken or his activities as a cryptocurrency entrepreneur.
Jesse Powell, founder of Kraken, in 2014. His home in Los Angeles was searched by the F.B.I. in March. Source: Bloomberg
In 2023, the FBI conducted a search of Powell’s home and seized electronic devices that could contain digital assets. According to media reports, US authorities had been investigating the Kraken co-founder since 2022.
Powell has repeatedly denied any wrongdoing and has filed a civil lawsuit against members of Verge’s board of directors. The report does not provide any reasons why the Justice Department and FBI dropped their investigation.
Changing regulatory environment
The conclusion of the Powell investigation comes amid a significant shift in the way U.S. regulators approach the crypto industry. In 2023, the Securities and Exchange Commission (SEC) filed a lawsuit against Kraken, accusing the exchange of operating without proper registration. However, in March of this year, the agency withdrew the case.
Kraken’s Crypto Exchange Overview. Source: CoinCodex
The enforcement action against Kraken was one of several cases the SEC dropped, reflecting an apparent change in the agency’s stance on regulation through enforcement. Years of investigations and cases against companies like Ripple Labs, Coinbase, and Gemini have been revisited or dismissed in recent months.
The current situation reflects a broader turn in U.S. regulatory policy toward cryptocurrencies. The conclusion of Powell’s investigation and the dismissal of cases against leading industry players may point to a more favorable environment for digital assets in the country.
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Source:: FBI Closes Investigation into Kraken Co-Founder Jesse Powell