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The U.S. Commodities Futures Trading Commission (CFTC) has ordered Kraken to pay $1.25 million in fines for illegally offering trading products in the U.S. According to the Commission’s filing, the company failed to register as a futures commission merchant (FCM) and has facilitated margined prohibited retail commodity transactions between June 2020 and July 2021. 

In a statement to Business Insider, Kraken said that it cooperated with the CFTC during its investigation. The exchange noted that it was committed to working with regulators to ensure it implements adequate rules governing digital assets that create a level playing field globally. 

“As a firm committed to reasonable regulation, we engaged with the CFTC about its proposed margin trading guidance and sought clarity about what the guidance would permit. In June of this year, we started limiting our margin products in the US to eligible clients prior to entering into this settlement with the CFTC,” the company said.

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Vincent McGonagle, CFTC’s Acting Director of Enforcement, said that the action was part of CFTC’s broader effort to protect U.S. customers. As the Commission is tasked with regulating the derivatives market in the U.S., commodities, foreign exchange, fixed income, and cryptocurrency assets fall under its regulating remit.

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