Centralized exchanges can’t protect government customers, says Kraken CEO

Kraken CEO Jesse Powell said centralized crypto exchanges could be forced to comply with orders if law enforcement were to request that certain digital assets be frozen.

It was in response to a user who wanted to know if Kraken would comply with a police request to freeze assets without judicial authorization.

CEX under government regulations

This statement follows the Canadian government’s decision to blacklist 34 crypto wallets connected to the Freedom Convoy. By blacklisting the wallet, the Royal Canadian Mounted Police now have the power to freeze all funds sent from the wallets to a regulated exchange.

The Canadian government’s decision is the latest in a series of efforts to end anti-vax protests that have been going on for several weeks now. To end the protest, Prime Minister Justin Trudeau invoked the Emergencies Act and expanded it to cover cryptocurrencies.

This was after protesters switched to crypto donations due to centralized crowdfunding platforms such as GoFundMe and GiveSendGo halting donation drives for the protest. The move was criticized by many people, including crypto industry stakeholders and democracy advocacy groups.

According to for Powell, this decision is a sign of due process for the plebs. He added that “might does good in Canada. If someone is a dissenter, you simply confiscate their wealth, revoke their licenses, exclude them from the financial system, and kill their pets. No point in debating law, politics, or even rights when you have a monopoly on violence. »

He further advised people not to keep their crypto funds in centralized and regulated depositories. These exchanges cannot protect users from any government action, so it is best to only use P2P trading, he said.

Powell’s statements echo the concerns of other industry stakeholders. Last Tuesday, Coinbase CEO Brian Armstrong also noted the importance of self-custodial wallets in a situation like this.

Although there are many criticisms of the current situation in Canada, it also shows how important decentralization is for financial freedom. Although authorities can censor crypto wallets connected to centralized exchanges, crypto-assets themselves remain resistant to censorship. Thus, P2P transactions cannot be frozen.

Some see this moment as a good time for the crypto industry. Bitcoin Analyst, Plan B believes that this situation could be a major catalyst for the rise in value of the cryptocurrency.

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