Kraken Refuses to Comply with Court Order to Disclose XRP Holder Data

In a recent legal development, the American cryptocurrency exchange Kraken has taken a defiant stance against a court ruling demanding the disclosure of customer data related to the cryptocurrency XRP. The court had decreed that all American cryptocurrency exchanges must reveal the identities of individuals who have engaged in transactions involving XRP. However, Kraken is apprehensive about the potential negative consequences this disclosure could have on its customer relations and user trust.

This legal dispute traces its origins back to a few years ago when investor Vladi Zakinov filed a class-action lawsuit against Ripple, accusing its CEO, Brad Garlinghouse, of offering XRP as an unregistered security. Ripple vehemently denied these allegations, asserting that XRP is more akin to Bitcoin and Ethereum, both of which are not classified as securities.

John Deaton, representing XRP holders, downplayed the significance of this particular lawsuit, suggesting that Ripple is primarily focused on its ongoing battle with the U.S. Securities and Exchange Commission (SEC). Earlier this year, Judge Analisa Torres ruled that XRP should not be categorized as a security when sold on the secondary market, but it remains to be seen whether Judge Phyllis Hamilton, presiding over Zakinov's case, will adopt a similar interpretation.

In July, following Judge Torres's decision, Kraken relisted XRP alongside other major exchanges like Bitstamp, Crypto.com, Gemini, and Coinbase. However, as recently as October, Kraken confirmed its intention to share user data with the U.S. Internal Revenue Service (IRS), despite initially seeking to reject the IRS's request for user information. This ongoing legal battle underscores the complexities surrounding the regulatory status of cryptocurrencies in the United States.