Jesse Powell has stated that if U.S. regulators permit unethical individuals in the crypto industry to attract users, generate income, and receive venture capital, it could lead to the downfall of "the good guys."


Jesse Powell, the chief executive of the crypto trading company Kraken, has criticized U.S. financial regulators for facilitating the victory of “the bad guys” for their own benefit.


In his February 19 tweet thread, Powell posited that the U.S. government, possibly including the SEC, might be tolerating the questionable behavior of some crypto companies in order to divert attention away from others that conform to the law. He added that if this were to go unchecked, it could lead to the demise of digitally-governed currency, as smaller competitors are forced to compete against illegal operators, who could be apprehended at a later time by the authorities.


''The bad guys are actually on-side,” said Powell. “Good guys are the enemy. If the bad guys can run long enough without blowing up, they might just kill the good guys for you.''


Powell vented his frustration at the SEC's regulatory approach after Kraken came to a settlement with the comission, with the crypto firm consenting to no longer provide U.S. customers with staking services and paying a $30 million fine to keep the SEC quiet. This regulated-by-enforcement strategy employed by the SEC has been strongly criticized by members of the crypto sphere, especially when the regulator chose to pursue celebrities who promoted tokens on social media.


Powell revealed in September 2022 that he would be stepping down as CEO of Kraken and would be replaced by Dave Ripley, the company's chief operating officer. However, Powell would remain with the cryptocurrency firm as the chair of the board. Around the same time, Paxos was said to be under scrutiny by the SEC for purportedly breaching laws meant to protect investors in its dealings with Binance USD stablecoins.




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