Kraken Co-Founder Jesse Powell Faces Federal Investigation for Alleged Non-Profit Hacking and Cyberstalking

Jesse Powell, the co-founder of the popular cryptocurrency exchange Kraken, has found himself at the center of a federal investigation.

Law enforcement agencies are diligently pursuing claims that Powell engaged in hacking and cyberstalking activities against a non-profit organization he played a pivotal role in establishing.

The investigation, which has gained significant attention, raises serious concerns about the alleged misuse of power and violation of digital security protocols.

The investigation was prompted by allegations made by the Verge Center for the Arts, a non-profit organization based in Sacramento.

According to The New York Times, Verge Center for the Arts accused Powell of deliberately hindering their computer systems, impeding access to crucial emails and other important communications. The organization claims that Powell’s actions obstructed their ability to operate efficiently and compromised their mission.

Federal authorities, including the Federal Bureau of Investigation (FBI) and the U.S. attorney’s office for the Northern District of California, have been actively involved in the investigation since at least the fall of the previous year.

Their thoroughness was evident when agents executed a search warrant at Powell’s residence in Brentwood, located on Los Angeles’ prestigious Westside. Electronic devices were seized during the search, further indicating the seriousness of the allegations against Powell.

Brandon Fox, a lawyer representing Powell from Jenner & Block, responded to the allegations, asserting that Verge Center for the Arts had presented a biased account, failing to provide the government with a comprehensive picture of the situation.

He further emphasized that the matter at hand is entirely unrelated to Powell’s employment at Kraken or his conduct within the cryptocurrency arena.

Recent developments have seen Powell file a lawsuit against Verge Center for the Arts in California Superior Court.

Powell’s legal team claims that he still possesses ownership and rightful access to the email accounts in question.

However, Verge Center for the Arts, represented by their legal counsel, dismissed Powell’s claims as unfounded and without merit.

This investigation follows Powell’s removal from the board of Verge Center for the Arts in 2022. The organization cited violations of their “guiding principles” as the reason behind his removal, according to The New York Times.

CoinDesk sought a response from Verge Center for the Arts but had not received any comments from the organization at the time of publication.

Kraken, the cryptocurrency exchange founded by Powell, released a statement through a spokesperson acknowledging their awareness of the civil dispute, investigation, and search warrants.

The spokesperson made it clear that Kraken itself is not a part of the ongoing investigation and reiterated that the investigation does not concern Powell’s affiliation with Kraken.

As the federal investigation into Jesse Powell unfolds, the seriousness of the allegations surrounding non-profit hacking and cyberstalking casts a cloud of uncertainty over both Powell’s reputation and the reputation of Kraken as a prominent player in the cryptocurrency exchange industry. The outcome of this investigation will undoubtedly have far-reaching consequences for both Powell and the wider crypto community.