Kraken CEO Jesse Powell Defends Listing LUNA 2.0

Crypto winter sentiment is running high. Kraken CEO Jesse Powell has come under fire for defending the launch of the new LUNA (also known as LUNA 2.0), which aims to make the original LUNA (now known as LUNA Classic (LUNC)) and TerraUSD (now known as TerraUSD Classic) (USTC)) back to life.

Big names in the cryptocurrency industry, such as Castle Ventures’ Nic Carter, spoke out against the decision, while in another tweet, Powell slammed short-seller Jim Chanos, who had shorted Kraken’s biggest rival, Coinbase.

Carter simply tweeted "why" on Kraken's official Twitter account announcing the listing of the new LUNA.

client needs. Exchanges have a strange effect. Switching costs are low and people often want to do everything in one place for capital efficiency/synergies/convenience. Not supporting 1 coin that people are asking for can cost you your entire account. Listing is not an endorsement

— Jesse Powell (@jespow) May 30, 2022

As the fourth largest cryptocurrency exchange in the world, Kraken lists more than 160 cryptocurrencies. The list grows every month, from Bitcoin (BTC) to Filecoin (FIL) to the second generation of LUNA, which currently ranks 164th in its price index.

Terra's crash cost an estimated $50 billion, causing a Terra subreddit to be plastered with suicide hotline calls, while legal filings show Terraform Labs founder Do Kwon liquidated two affiliates and the entire company in the days leading up to the crash.

The project was subsequently hard forked and restarted, with little return to impoverished investors. For example, the airdrop didn’t work out as developers expected due to the uneven distribution of tokens. Since then, the new LUNA has fallen from a high of nearly $20 to less than $8, despite a Binance airdrop that fueled a 90 percent price increase.

Powell noted that the reason for LUNA to go public was "customer demand." Rohan Gray, an assistant professor of law at Willamette University, called Powell to say that eBay doesn’t allow fraudsters to stay on the e-commerce platform, so why would a cryptocurrency exchange give Terra a seat at the table? Here’s a mockery of what Powell said about Kraken:

“We are a marketplace, like eBay. BTC traders don’t pay.”

Powell has previously shown a decisive side in its operations, most recently shutting down Kraken's global headquarters because "San Francisco is not safe." However, when it comes to money and Kraken, “we try to be as asset agnostic as possible,” he tweeted.

“Fiat and most stocks are rubbish, but where is the anger? These other token revenues pay for all the security, pro-BTC lobbying and marketing.”

In another Twitter thread, Kraken defended the future of cryptocurrency exchanges. On the Crypto Critics Corner podcast, U.S. investment manager Chanos detailed his short position against Coinbase, the largest U.S. cryptocurrency exchange. For Powell, "there will be a paradigm shift in the next 10 years," and cryptocurrency exchanges will be the winners.

Infighting and Twitter spats aside, for those looking for a signal in the war of words, Powell shared his investment preferences for Bitcoin, investing in exchanges, or both:

Personally, I'd like to have both. Exchanges are sort of betting on the entire growth space.

— Jesse Powell (@jespow) June 1, 2022

Kraken did not immediately respond to Cointelegraph's request for comment.