U.S. District Court for the Northern District of California Judge William H. Orrick has ruled that the Securities Exchange Commission's (SEC) lawsuit against the Kraken crypto exchange will proceed to trial. The SEC alleges that Kraken is not registered as a broker, exchange, or clearing house, and claims that some cryptocurrency transactions on its platform constitute investment contracts and fall under the category of securities. Despite Kraken's attempt to dismiss the lawsuit, arguing that cryptocurrencies did not meet the definition of a security in the Howey test, Judge Orrick decided to proceed with the case. He said that while cryptocurrencies are not securities per se, their trading contracts may constitute investment contracts and therefore should be governed by securities laws. This case shows that the SEC is expanding its regulatory reach beyond exchanges to include specific cryptocurrencies such as Cardano (ADA) and Solana (SOL).