Kraken Under Fire as Former Employee Questions Pay


Kraken, one of the oldest and largest Bitcoin exchanges in the world is looking at litigation from former employee Jonathan Silverman, Bloomberg reports.

Silverman came on board in 2017, and managed Kraken’s institutional sales and trading desk in New York.

Now, Silverman is claiming that he was offered at a 10% commission, and calculates that he is owed nearly $1 million.

Kraken’s history in New York is already fraught – reports like this one show New York regulators coming after the exchange, and putting a regulatory burden on Kraken while insinuating that the exchange could be violating existing regulations.

“In the latest escalation of an ongoing war of words, the New York State attorney general warned that the Kraken cryptocurrency exchange might be breaking the law,” wrote Michael del Castillo at Forbes last September. “In a lengthy report on the ‘integrity’ of global cryptocurrency exchanges, newly appointed attorney general Barbara Underwood listed San Francisco-based Kraken among multiple exchanges that might be operating ‘unlawfully.’ However, following an impassioned and very public refusal by Kraken’s CEO to participate in the report, the warning appears to be based as much on lack of access as any legitimate concern.”

Kraken wasn’t the only exchange in the New York Attorney General’s sights – but communications showed the exchange’s founder, Jesse Powell and others felt unfairly pursued by state regulators. In contemporary reporting of the new kerfuffle around Silverman’s compensation, Vildana Hajric and Matthew Leising at Bloomberg go back to a post written when Kraken exited the New York market three years ago, quoting:

“Regrettably, the abominable BitLicense has awakened. It is a creature so foul, so cruel that not even Kraken possesses the courage or strength to face its nasty, big, pointy teeth.”

Many traders saw the Kraken/New York controversy as a liability for Bitcoin in an age where regulatory issues can influence adoption. Now, it’s more of a moot point, since Kraken no longer operates there. But a lawsuit by a former employee could shed more light on what really happened in a New York minute in the crypto world.