Federal Prosecutors Close Inquiry Into Kraken Co-Founder Jesse Powell
By Ryan Mac, Reporting from Los Angeles | July 22, 2025
The U.S. Justice Department has officially closed a criminal investigation into Jesse Powell, co-founder of the prominent cryptocurrency exchange Kraken. Court documents reviewed by The New York Times reveal that this inquiry, initiated following a federal raid in 2023, was concluded earlier this year.
Background of the Investigation
In 2023, the Federal Bureau of Investigation executed a search warrant at Powell’s residence in Los Angeles as part of an investigation concerning allegations that he had unlawfully accessed and disrupted online accounts linked to Verge Center for the Arts. Verge is a Sacramento-based nonprofit which Powell himself founded in 2007 but was removed from its board in 2022. The organization cited violations of its “guiding principles” as the reason for his ousting.
Following his removal, Powell initiated legal action against Verge, accusing the nonprofit of defamation and fraud. Verge, in turn, accused Powell of blocking employees from accessing the organization’s digital platforms and illicitly obtaining confidential information, according to correspondence from Verge’s legal counsel to Kraken.
Closure of Investigation and Current Status
A letter sent last month by the U.S. attorney’s office for the Northern District of California to Powell’s legal team confirmed that the criminal probe into the alleged misconduct had been opened but was officially closed in April 2025. The letter also stated that the office reserves the right to reopen the case should new evidence arise.
Requests for further comment from the U.S. attorney’s office were not returned.
Powell’s Response
Powell described the FBI raid on his home as “devastating both personally and professionally” in a statement released on Tuesday. Despite the conclusion of the federal investigation, he expressed his intent to persist with his lawsuit against Verge, emphasizing his commitment to seek legal remedies for what he characterized as false accusations made to law enforcement.
Kraken and Powell’s Professional History
Jesse Powell is recognized for helping to establish Kraken as one of the largest cryptocurrency exchanges within the United States. However, in 2022, Powell stepped down as Kraken’s chief executive, following media reports that highlighted his involvement in contentious workplace debates related to race and gender.
Shortly thereafter, Verge severed its formal ties with Powell. His departure from both entities has been marked by ongoing disputes and legal confrontations involving the oversight and control of digital assets and organizational integrity.
Ongoing Coverage
The complexities surrounding Jesse Powell, Kraken, and Verge Center for the Arts underscore the evolving challenges at the intersection of technology, governance, and legal accountability within the crypto industry. As developments unfold, further reporting will aim to provide clarity on the implications for all parties involved.
Reporting contributions by David Yaffe-Bellany from New York.
For additional information on Kraken and related coverage, visit The New York Times Technology Section.