Key Insights:
- Kraken co-CEO Arjun Sethi admitted that questions about Monero withdrawals went beyond justified compliance checks.
- Kraken withdrew the disputed requests and told affected XMR customers they no longer had to respond.
- Monero remains listed in supported markets, although existing deposit and withdrawal restrictions remain.
Kraken co-CEO Arjun Sethi withdrew controversial Monero withdrawal questionnaires on Oct. 24. He acknowledged that no rule required the disputed requests and reaffirmed support for XMR.
The reversal followed criticism over emails seeking sensitive financial information from Monero customers. Sethi said Kraken had withdrawn the requests and informed affected users.
Kraken CEO Admits Monero Withdrawal Questions Went Too Far
The dispute began after Kraken contacted customers who had purchased and withdrawn Monero (XMR). According to Sethi, the emails requested employment details, sources of funds, and intended use of cryptocurrency.
Screenshots circulated across Reddit and X, drawing criticism from privacy advocates. Some questioned why Kraken wanted information about transactions conducted outside its platform.
In his Oct. 24 statement on X, Sethi accepted responsibility for the incident. He described the requests as unjustified and acknowledged that Kraken had made a mistake.
Sethi explained that an internal assessment flagged a younger customer holding substantial funds. He rejected the assumption that the customer’s age and wealth automatically justified suspicion.
The Kraken executive said the exchange had withdrawn the requests. Affected customers received confirmation that they no longer had to provide the requested information. However, Sethi distinguished legitimate financial verification from questions about customers’ future transactions.
He defended checking the origins of customer funds under existing compliance procedures. However, he rejected inquiries about how customers planned to use their withdrawn cryptocurrency.
The distinction matters for Monero because its blockchain obscures transaction amounts and participant addresses. Such privacy features have complicated compliance decisions across centralized cryptocurrency exchanges.
Sethi did not disclose how many customers received the disputed questionnaires. He also provided no timeline for their original distribution.
Kraken Confirms Monero Listing Despite Existing Restrictions
Sethi also addressed concerns about Monero’s continued availability on Kraken. “XMR stays listed,” he wrote, reaffirming the exchange’s support for the privacy-focused cryptocurrency. However, his statement did not reverse existing geographic restrictions or transaction limits.
According to Kraken’s official funding policy, the exchange introduced Monero transaction limits on Aug. 15, 2026. Individual customers can deposit up to $3,500 and withdraw $1,500 over a rolling 30-day period. Corporate accounts face respective limits of $30,000 and $10,000.
Kraken attributed these restrictions to its risk-based compliance framework. The exchange said the controls supported continued XMR trading and transfers.
Sethi’s latest statement did not announce any revision to those limits. Kraken also previously restricted Monero trading in several jurisdictions.
The exchange halted XMR trading and deposits for European Economic Area customers on Oct. 31, 2024. It cited regulatory developments when announcing the decision.
Kraken subsequently disabled Monero trading for Canadian customers on Sept. 2, 2025. The exchange continued allowing withdrawals under its Canadian delisting arrangements.
Consequently, Sethi’s listing assurance applies to markets where Kraken still supports Monero.
Monero Privacy Debate Faces Further Regulatory Pressure
Kraken’s reversal came amid broader regulatory scrutiny of privacy-focused cryptocurrencies. The European Union’s Anti-Money Laundering Regulation introduces further restrictions from July 10, 2027.
Article 79 prohibits regulated crypto-asset service providers from maintaining accounts that permit transaction anonymization through privacy coins. However, the provision does not establish a general prohibition on individuals holding Monero in self-custody wallets.
The distinction highlights the continuing tension between financial privacy and exchange compliance requirements.
Kraken’s decision addressed one customer-verification dispute without reversing its broader restrictions. The exchange has not publicly detailed whether it will revise its internal procedures to prevent similar requests.
