The U.S. Department of Justice (DoJ) has officially dropped its investigation into Jesse Powell, co-founder of Kraken, following allegations of hacking a nonprofit organization. The case, unrelated to Kraken’s operations, concluded without charges, with Powell’s seized devices returned earlier this year.
The probe, which began in 2023, centered on claims Powell hacked Verge Center for the Arts, a Sacramento nonprofit he co-founded. The DoJ’s decision, finalized in April 2024, was confirmed in June, allowing Powell to pursue legal remedies against accusers.
Investigation Timeline and Allegations of US Kraken Co-Founder
The investigation into Jesse Powell began in 2023 after the Verge Center for the Arts, a nonprofit he co-founded, accused him of hacking its computer system. Powell had been removed from Verge’s board in 2022 following a management dispute, and the nonprofit alleged he blocked employee access to emails, websites, and internal communication tools.
#FBI raids ex-Kraken CEO Jesse Powell's home in #cyber stalking probe against Verge Center for the Arts.#Cryptocurency #CryptoNews @jespow pic.twitter.com/2NilTnivn2
— Crypto Luster (@CryptoLstr) July 8, 2023
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These allegations led to a raid by the FBI on Powell’s Los Angeles home in 2023, during which computers, laptops, and phones were seized.
Despite extensive scrutiny, federal prosecutors concluded in April 2024 that there was no evidence of criminal activity. The U.S. Attorney’s Office issued a “declination letter” in June 2024, formally ending the case and authorizing the return of Kraken co-founder devices.
Reports from leading media confirmed that the probe was unrelated to Kraken’s operations and was purely tied to Powell’s dispute with Verge executives. Powell, who had donated over $1 million to the non-profit, maintains that the allegations were false and part of a conspiracy against him.
🚨 BREAKING: FBI drops probe into Kraken founder Jesse Powell and returns seized devices. pic.twitter.com/gnDLfse1qr
— Cointelegraph (@Cointelegraph) July 22, 2025
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The closure of the case came as a relief for Powell, who has stated that the investigation caused reputational harm to both him and Kraken. The timeline from 2022 through mid-2025 highlights the prolonged nature of the allegations.
Now Jesse Powell has focused on clearing his name through civil litigation against Verge’s board members.
Implications for Powell and Kraken
The resolution of the DoJ’s investigation marks a turning point for Powell. He remains committed to pursuing civil lawsuits to address the accusations. Powell’s attorney emphasized that the declination letter was critical in restoring Powell’s reputation.
That also affected Kraken’s prominent role in the volatile crypto industry. While the case did not involve Kraken directly, market sentiment and public perception were affected. Powell publicly denied all claims and sought accountability from those he believes defamed him.
🚨 FBI drops investigation into Kraken founder Jesse Powell
The case wasn’t about Kraken or crypto, it stemmed from a dispute with a nonprofit he founded.
His seized devices have been returned, and Powell is now moving forward with his defamation lawsuit.#Kraken #JessePowell pic.twitter.com/4peVHdgIkh
— CRYPTOMOJO_TA (@CRYPTOMOJO_TA) July 22, 2025
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The legal battle underscores the complex intersection of personal disputes and professional reputation in the crypto sector. Powell claims the allegations hurt his reputation during a period of intense crypto growth.
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prices surging from around $23,000 in 2023 to approximately $120,000 in mid-2025, Powell’s ability to focus on business operations has been essential for Kraken’s ongoing success.
Looking forward, Powell plans to continue legal actions against Verge board members to prove the accusations were false. The dropped investigation clears him of any criminal suspicions. It also gives him momentum to rebuild public trust and strengthen Kraken’s reputation.
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