CHENNAI: Crypto exchange Kraken agreed to shut down its US cryptocurrency staking service and pay $30 million in penalties to settle US Securities and Exchange Commission charges that it failed to register the program, the agency has said, in a move that could cause headaches for platforms with similar offerings.

The settlement marks the SEC’s first crackdown on staking, a common service offered at both centralised and decentralised crypto exchanges, including most of the major exchanges in the US such as Coinbase and Binance US.

Owners of crypto assets using a “proof-of-stake” blockchain can stake some of their assets to potentially take part in the process of validating transactions. In exchange for their work, validators are often rewarded with newly created crypto assets.

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