Kraken Parent Company Sues Etana Custody Over Alleged $25 Million Fraud Scheme

Payward, the operator of the Kraken cryptocurrency exchange, has filed a lawsuit against Etana Custody and its CEO, Dion Brandon Russell. The complaint alleges that Etana conducted a Ponzi-like scheme by misappropriating more than $25 million in customer reserve funds.

The lawsuit claims that Etana commingled Kraken customer reserves with its own corporate capital, diverting approximately $16 million of these funds into Seabury Trade Capital notes. These notes subsequently defaulted, and Russell allegedly represented the assets as secure.