Kraken’s parent company Payward files a lawsuit alleging that its crypto custody provider, Etana, and Etana’s chief executive officer misused client assets. According to the complaint cited by multiple outlets, Payward claims that approximately $25 million in crypto held in custody was misappropriated, including allegations that funds were commingled with other money and concealed from investors or clients. The filing describes the alleged conduct as operating in a “Ponzi-like” manner, stating that capital was allegedly used to cover expenses and pursue risky investments rather than to maintain proper custody obligations.
The allegations also tie the alleged scheme’s collapse to a period of market stress, with the dispute presented as coming to a head during a liquidity crisis. The lawsuit seeks remedies related to the alleged loss of client funds and the alleged failure to safeguard assets entrusted to Etana.
The sources characterize this as a custody and counterparty dispute involving Payward’s relationship with its custodian, rather than a direct claim about Kraken itself. The matter is currently framed through the allegations in the complaint, with no outcome reported in the provided coverage.
