Cryptocurrency exchange Kraken has announced its acquisition of TradeStation Crypto, the digital assets unit of TradeStation Group. This move is aimed at enhancing Kraken’s regulatory licensing presence in the United States, as reported by Seeking Alpha on Thursday (April 18).

According to a Kraken spokesperson cited in the report, this acquisition is a strategic step to accelerate Kraken’s growth and explore new product opportunities in the U.S. TradeStation Crypto holds money transmitter and various regulatory licenses across multiple U.S. states.

Despite TradeStation Crypto’s regulatory licenses, the Securities and Exchange Commission (SEC) highlighted the company’s failure to register a crypto lending product before offering it to investors. As a result, TradeStation Crypto settled with the SEC for $1.5 million.

Kraken also faced scrutiny from the SEC when the agency charged the company in November for allegedly commingling customer funds with its own while operating without proper registration. Kraken, in response, expressed its disagreement with the SEC’s stance and stated its intention to defend its position in court.

During a conference in New York on April 10, Kraken’s chief compliance officer CJ Rinaldi emphasized the importance of proactively identifying and addressing issues with regulators to prevent unexpected outcomes. Rinaldi highlighted Kraken’s ongoing investments in compliance controls and staffing, underscoring the industry-wide significance of learning from such experiences.

In a separate development, Kraken unveiled Kraken Institutional in February, a new brand designed to streamline access to the company’s products and services for institutions, asset managers, hedge funds, and high net-worth individuals. Kraken Institutional serves as a centralized point of contact for institutions seeking exposure to the cryptocurrency asset class.

For more information on acquisitions, cryptocurrency, and regulatory developments involving Kraken, TradeStation, and the SEC, stay tuned to the latest updates from PYMNTS News and other reputable sources in the industry.