Federal Prosecutors Close Inquiry Into Kraken Crypto Exchange Co-Founder Jesse Powell
By Ryan Mac, Reporting from Los Angeles — July 22, 2025
The U.S. Department of Justice has recently closed a criminal investigation into Jesse Powell, co-founder of the Kraken cryptocurrency exchange, according to court documents reviewed by The New York Times. The closure of the inquiry marks the end of a prominent legal episode involving Powell, whose home was raided by the Federal Bureau of Investigation (FBI) in 2023. ### Background of the Investigation
The FBI’s search of Powell’s residence in Los Angeles was part of a probe into allegations that he had unlawfully accessed and interfered with online accounts belonging to Verge Center for the Arts, a Sacramento-based nonprofit organization. Powell originally founded Verge in 2007 but was removed from its board of directors in 2022 after the organization’s leadership cited violations of its guiding principles.
Following his removal, Powell filed a lawsuit against Verge, accusing the nonprofit of defamation and fraud. In response, Verge alleged that Powell had obstructed employee access to the organization’s website, email, and internal messaging systems, as well as accessed confidential information stored in those channels. These allegations intensified the scrutiny on Powell and formed the basis for the FBI investigation.
Official Confirmation of the Closed Inquiry
A letter from the U.S. Attorney’s Office for the Northern District of California, dated last month and addressed to Powell’s legal representatives, confirmed that an “appropriately authorized investigation” had been initiated into the criminal allegations against Powell. The letter further stated that the investigation was officially closed in April 2025. However, the U.S. Attorney’s Office reserved the right to reopen the case should new information emerge. Attempts to obtain additional comments from the office were unsuccessful.
Jesse Powell’s Response
Powell described the FBI raid as “devastating both personally and professionally.” Undeterred, he pledged to continue pursuing legal action against Verge for what he claims are false statements made to law enforcement agencies that led to the investigation.
“I will continue to pursue the appropriate legal remedies against those who created this disaster by making false statements to law enforcement,” Powell said in a statement issued Tuesday.
Phillip Cunningham, legal counsel representing Verge, declined to comment on the developments.
Powell’s Role at Kraken and Previous Controversies
Jesse Powell was instrumental in growing Kraken into one of the largest U.S.-based cryptocurrency exchanges. His tenure came under scrutiny in 2022 after reports surfaced detailing his involvement in contentious debates about race and gender dynamics within the workplace. Subsequently, Powell stepped down as Kraken’s Chief Executive Officer that same year.
Shortly after his departure from Kraken, Verge Center for the Arts, the nonprofit he founded, sought to sever all ties with Powell due to the aforementioned violations of organizational principles.
Looking Ahead
While the current investigation has been closed, the legal disputes between Powell and Verge remain active. The U.S. Attorney’s Office’s declaration that it may reopen the inquiry leaves open the possibility of future developments. For now, Jesse Powell is focused on his ongoing lawsuit and restoring his professional and personal standing following a turbulent period.
For more updates on this story and other technology news, stay tuned to The New York Times.
© 2025 The New York Times Company