Kraken Sues PowerTrade Over Alleged $6M Fund Misappropriation
Kraken parent Payward has filed a lawsuit against UAE-based crypto derivatives platform PowerTrade, alleging that the firm misappropriated over $6 million through unauthorized account adjustments. According to a U.S. federal court filing on Thursday, PowerTrade retroactively canceled Payward’s profitable trades that had settled months earlier, converting a positive balance of more than $6 million into a negative balance of nearly $2 million. The lawsuit claims PowerTrade used a series of 100 unauthorized 'corrections' to create an artificial debt, allowing them to seize Payward’s bitcoin collateral. Kraken had started using PowerTrade for institutional derivatives trading in 2022, but began facing liquidity concerns in October 2025 when Bitcoin prices fell. Payward is now seeking discovery from US financial institutions to support legal proceedings against PowerTrade and its co-founders Mario Gomez Lozada and Bernd Sischka. Kraken stated it is committed to decisive action to protect the crypto industry. PowerTrade has not responded to requests for comment.
Key facts
- Kraken parent Payward sues PowerTrade for allegedly misappropriating over $6 million.
- PowerTrade used 100 unauthorized 'corrections' to turn a $6M positive balance into a $2M negative balance.
- The lawsuit claims PowerTrade retroactively canceled settled trades to create artificial debt.
- Kraken began using PowerTrade in 2022 but faced liquidity issues in October 2025.
- Payward seeks discovery from US financial institutions to aid legal proceedings.