Kraken adjusted by restricting fiat trading to wholesale investors while keeping cryptocurrency trading unchanged.
The Federal Court of Australia came to the conclusion that while the margin extensions for fiat currency that Kraken provides are subject to regulatory scrutiny, the margin extensions for cryptocurrency are not subject to the same duties.
In response, the cryptocurrency exchange acknowledged the court’s verdict but also emphasized the critical need for more open and transparent legislation regarding cryptocurrencies in Australia.
Kraken Eyes Clearer Crypto Regulations in Australia
The exchange made adjustments to its margin trading services because of the verdict. These adjustments included restricting the trading of fiat currency to wholesale investors exclusively while maintaining the status quo for cryptocurrency margin trading.
Kraken has reaffirmed its commitment to adhering to compliance standards and has fought for improved regulatory clarity within the cryptocurrency industry. A recent update made this clear.
Despite acknowledging the court’s verdict, the company emphasized the wider ramifications for the regulation of cryptocurrencies, particularly in Australia.
Although the firm expressed some dissatisfaction with the result, which found a violation of the Corporations Act in a portion of their margin product, it stated that it considers the court’s decision to be a step in the right direction for supporters who are seeking new rules around cryptocurrencies.
The verdict specifically underscored the inadequacy of Australia’s current legislation concerning Bitcoin regulation.
By pointing out that this decision further underscores the essential need for clear and specific laws for the cryptocurrency industry in Australia, the company brought attention to the fact that it is one of the most prominent cryptocurrency exchanges.
The current legal framework leaves both enterprises and investors in a state of ambiguity, potentially hindering innovation. Immediately after the court’s decision, Kraken made the necessary adjustments to its margin trading services in order to comply with the mandates of the law.
Restricting Fiat Margin Trading in Australia Following Court Ruling
Kraken has placed a restriction on the platform, limiting margin trading using fiat currency to Australian citizens who meet the requirements to be considered wholesale investors, as outlined in the Corporations Act 2001.
These modifications, on the other hand, will have no effect on cryptocurrency margin trading. Because of this adjustment, it is now possible to engage in unlimited margin trading in cryptocurrency pairings.
On the other hand, wholesale investors are the only ones who can access fiat margin extensions. Kraken maintained its commitment to following all regulations in every jurisdiction where it operates.
