Payward, the parent company of crypto exchange Kraken, has filed a lawsuit alleging $25 million in crypto custody fraud against Etana and its CEO, Dion Brandon Russell, alleging that the company misappropriated client funds. The lawsuit alleges that Etana, which is currently in Chapter 11 bankruptcy, operated a "Ponzi-like" scheme where custodial assets were mixed, spent on operating expenses and risky investments, falsely reported as intact to clients. Kraken claims Etana stalled with fabricated reconciliation issues and misleading explanations when it sought to withdraw $25m in reserve funds in 2025. The company is seeking at least $25M in damages, potential treble damages under civil theft claims, and injunctive relief and attorneys' fees.