Payward, the parent company of the cryptocurrency exchange Kraken, has asked the Delaware Court of Chancery to enter a final judgment against its former auditor, Mazars USA, after the arbitrator awarded the firm $22 million.
The exchange disclosed the proposal on July 7 through an open public forum letter from Co-CEO Arjun Sethi and a list of documents from CEO Dave Ripley.
The dispute began in December 2023, when Mazars pulled out of Kraken’s 2022 accounting period. Mazars evaluated Kraken three years ago and issued two clean recommendations, according to the company.
In writing, Sethi said, the auditor confirmed that he had no disagreements with management, no concerns about the integrity of the company, and no findings of fraud.
Mazars said the resignation was due to legal issues, among them the Securities and Exchange Commission’s complaint filed against Kraken weeks ago.
That SEC complaint was dismissed with prejudice, without penalties and an admission of wrongdoing. Kraken said the abandoned investigation took years and millions of dollars to secure new auditors and convince banks, regulators, and partners. The exchange said it has received a cleanliness audit in each subsequent year.
The letters come as the Kraken they follow All European bank authorization, it is said through Lithuania, a move that would allow the company to provide traditional banking services across the European Economic Area and the possibility of being the first cryptocurrency exchange to obtain all European bank authorization, according to CoinDesk to announce.
The effort is part of Kraken’s strategic plan as it expands beyond cryptocurrencies to multi-currency, and builds on key features including payment access with the US Federal Reserve and authorization in the UAE.
Operation Chokepoint 2.0
Sethi placed the section within what the critics called Operation Chokepoint 2.0a statement that describes it as a concerted effort by regulators to limit the legalization of crypto companies to banking and other services. In December 2022, one year before leaving the Kraken research, Mazars Group has been suspended proof of service reserves to the crypto sector and remove those reports from its website.
The letter mentioned many things from 2022 and 2023. On January 3, 2023, the Federal Reserve, the FDIC, and the OCC. printed A joint statement warning that crypto business models raised security concerns is understandable for banks.
Documents released after the Freedom of Information Act lawsuit showed that the FDIC sent at least 25 letters to a dozen banks urging them to pause or refrain from expanding crypto operations. The SEC’s SAB 121 accounting guidance required public companies that own crypto to list those assets on their balance sheets, making banking uneconomic.
The Federal Reserve Board he refused account balance at Custodia, a Wyoming bank for digital products. And in March 2023, the payment networks operated by Silvergate and Signature shut down after a few days.
As the debanking period ends, Kraken demands regulation
More about that framework it’s done. The value of the SEC removed SAB 121, banking regulators removed the consensus wording, and a House committee report said regulators used vague rules and deliberate coercion to push banks away from legitimate digital companies.
Sethi also described what happened to Kraken founder Jesse Powell, who started the exchange in 2011. In March 2023, federal agents. attacked Powell forfeited his assets in connection with a dispute involving a non-profit related to Kraken.
After two years, the government stopped the investigation, returned the equipment, and said nothing. Powell gave Ripley the lead role, and Sethi joined Ripley in leading the company.
The letter was closed and called on Congress to pass it CLARITY Actwhich would regulate the commodity futures market, divide oversight between the Commodity Futures Trading Commission and the SEC and increase protections for software developers.
The House passed the resolution in July 2025 by a vote of 294 to 134, with 78 Democrats in favor, and the Senate Banking Committee. advance his version in May.
Sethi distinguished the period between the US and the European Union, when the MiCA system came into force in all member states.
