As of February 9, 2023, the Securities and Exchange Commission (SEC) has accused Payward Ventures, Inc. and Payward Trading Ltd, better known as Kraken, of failing to register the sale of their cryptocurrency staking-as-a-service program. The SEC's complaint alleges that since 2019, Kraken has been selling “staking” services to the general public, where investors transfer their cryptocurrencies to Kraken, which pools them together and stakes them on behalf of the investors in exchange for the promise of annual returns as high as 21 percent.

Staking is a process where investors lock up, or "stake", their crypto tokens with a blockchain validator in the hope of being rewarded with new tokens. However, when investors provide tokens to staking-as-a-service providers, they lose control of their tokens and are exposed to the risks associated with the platform, with little protection. The SEC's complaint alleges that Kraken represented its staking investment program as offering an easy-to-use platform and benefits derived from Kraken's efforts on behalf of investors, including strategies to achieve regular investment returns.

To settle the SEC's charges, both Kraken entities have agreed to immediately stop offering or selling securities through crypto staking services and to pay $30 million in disgorgement, prejudgment interest, and civil penalties.

In addition to stopping the staking program and the monetary relief, Payward Ventures, Inc. and Payward Trading, Ltd., without admitting or denying the allegations in the SEC's complaint, have agreed to a final judgment that would permanently enjoin each of them from violating Section 5 of the Securities Act of 1933 and permanently enjoin them and any entity they control from offering or selling securities through crypto staking services or staking programs.