SEC ends probe into Robinhood Crypto without any lawsuit
- The US SEC ended its investigation into Robinhood Crypto without taking any further action against the company.
- The SEC issued a Wells notice to Robinhood Crypto in May 2024 over the potential illegal listing of securities on its platform.
- This marks another win for the industry as the new SEC administration scales down the agency's crypto crackdown.
Robinhood Crypto (RHC) announced on Monday that the United States (US) Securities & Exchange Commission (SEC) has dropped its investigation into the exchange less than a year after issuing a Wells notice and will not take any legal action.
Robinhood Crypto celebrates as SEC closes investigation with no enforcement action
Robinhood Crypto (RHC) announced that the US SEC's Endorsement Division has dropped its probe into the company.
The regulator will also not take any legal action against the company.
"We applaud the staff's decision to close this investigation with no action," said Dan Gallagher, Chief Legal, Compliance and Corporate Affairs Officer of Robinhood Markets, Inc.
Gallagher also stated that the investigation should never have begun in the first place. He argued that Robinhood has always complied with securities laws and "never allowed transactions in securities."
The SEC sent a Wells notice to RHC in May 2024 concerning its cryptocurrency trading platform. The notice stated that the SEC staff had reached a preliminary determination to issue an enforcement action against RHC for violating securities laws.
A Wells notice is a formal notification that the SEC intends to pursue enforcement action against an individual or company after completing an investigation.
Robinhood responded, stating that the company "made difficult choices not to provide certain products and services that the SEC under previous Chair Gary Gensler alleged are securities in public actions."
The SEC's decision to drop its investigation into RHC reflects growing changes in the agency's approach to crypto.
The regulator reached an agreement in principle to drop its case against Coinbase on Friday, with no fines attached.
The new SEC administration has also been collaborating with crypto leaders and experts to create better regulatory frameworks to guide the industry.
Meanwhile, the SEC's crypto task force met with crypto industry leaders last week, including Robinhood executives and Strategy CEO Michael Saylor, to discuss crypto regulations and framework for digital assets.
Saylor shared about token taxonomy and defining specific types of digital assets, among other things.
Author
Michael Ebiekutan
FXStreet
With a deep passion for web3 technology, he's collaborated with industry-leading brands like Mara, ITAK, and FXStreet in delivering groundbreaking reports on web3's transformative potential across diverse sectors. In addi
