Kraken Settles With The Treasury Department

The U.S. Treasury Department’s coffers got a little fatter on Tuesday, courtesy of crypto exchange Kraken.

As part of a settlement between Kraken and the Treasury Department, Kraken has agreed to pay more than $362,000 to settle allegations of violating U.S. sanctions against Iran by failing to prevent users in Iran from using Kraken.

It’s the latest act of enforcement by the Treasury Department, following August’s Tornado Cash crackdown and October’s $29 million sanction against crypto exchange Bittrex.

We’ve discussed the Treasury Department before on CoinSnacks, but it bears revisiting with the latest Kraken news.

The relationship between crypto and nation-state sanctions is complex.

On the one hand, the U.S. government has a credible case that sanctions are needed for national security reasons. One could also make the ethical argument that crypto shouldn’t be available to oppressive regimes like Iran.

But, on the other hand, is it really right for an entire nation to be unable to use crypto? More fundamentally, isn’t the point of crypto for it to be uncensorable and accessible to all? If the government can tell us when and where we’re allowed to use crypto, how is that any different from fiat?

These are tough questions. Kraken settled in this case but, in the past, has resisted pressures to censor Russian users.

It really shows that this is an issue with a lot of gray area.