After the United States Securities and Exchange Commission revealed that it had reached a settlement with cryptocurrency exchange Kraken, SEC Chairman Gary Gensler issued a warning to cryptocurrency companies, urging them to “get in there and respect the law”.

During an appearance on CNBC’s Squawk Box on February 10, 2018, Gensler said that cryptocurrency exchanges must register with the SEC to comply with United States rules. He claimed that many participants in the business were “choosing” not to. The head of the Securities and Exchange Commission (SEC) said that the business models of many cryptocurrency projects were “fraught with conflict” and that these projects needed to “untangle” their packaged products.

According to Gensler, “time-tested rules and laws to safeguard the investing public” are necessary if the industry is to have any hope of surviving and prospering in the future. “Don’t put your hand in the customer’s wallet using their money for your own platform,” the sales pitch advised.

After the SEC announced that it had settled with Kraken, Gensler made his statement. As part of the settlement, Kraken agreed to pay $30 million in repayment, pre-judgment interest, and civil penalties. In addition, the exchange has agreed to stop offering its services and engagement programs to clients in the United States. Kraken said it will continue to provide engagement services for customers located outside of the United States through a different business.

There has been a lot of backlash to the deal the SEC reached because many people see it as regulators taking action against companies that need to navigate a regulatory landscape that doesn’t have clear standards. SEC Commissioner Hester Peirce said the staking program had “served people well” and that the SEC’s actions could be described as “lazy and patronizing.”