The Securities and Trade Fee (SEC) closed its investigation into Robinhood Crypto (RHC) with out pursuing enforcement actions. This transfer comes amid the Fee’s efforts to maneuver away from its earlier “regulation by enforcement” method beneath the brand new industry-friendly administration.
SEC Closes Robinhood Crypto Investigation
On Monday, Robinhood introduced that the US SEC’s Enforcement Division had closed its 9-month investigation into its crypto arm with out taking any enforcement measures. In Might 2024, the Fee’s workers issued a Wells Discover to Robinhood, indicating that they might advocate the SEC file an enforcement motion for allegedly violating securities legislation with its US crypto arm.
On February 21, the regulatory company despatched a letter notifying RHC concerning the official conclusion of the inquiry, including that it didn’t intend to maneuver ahead with an enforcement motion.
Robinhood’s Chief Authorized, Compliance, and Company Affairs Officer, Dan Gallaghers, said that the investigation “by no means ought to have been opened” however applauded the SEC’s determination to shut it with out motion.
He affirmed that Robinhood Crypto “all the time has and can all the time respect federal securities legal guidelines and by no means allowed transactions in securities,” including that any case towards the agency’s crypto arm would have failed. “We’re blissful to see a return to the rule of legislation and dedication to equity on the SEC,” Gallagher concluded.
In an X put up, Robinhood’s CEO and co-founder Vladimir Tenev referred to as the event a “win for justice and the rule of legislation” He urged the event of pro-innovation insurance policies that “unlock the total potential of digital property in America.”
The Period Of ‘Regulation By Regulation’?
In its assertion, Robinhood argued that its crypto arm, in contrast to different platforms, has complied with the SEC regardless of lengthy disagreeing with the argument that almost all digital property transactions fall beneath federal securities legal guidelines.
Whereas Robinhood has lengthy disagreed with the argument that transactions in most digital property are topic to federal securities legal guidelines, RHC, versus different platforms, made tough selections to not present sure services and products that the SEC beneath earlier Chair Gensler alleged are securities in public actions.
The agency urged the SEC to proceed transferring away from its “regulation by enforcement” method to “regulation by regulation” to offer market members with “readability and an acceptable regulatory framework for digital property.”
This growth follows the SEC’s latest dismissal of its lawsuit towards Coinbase. As reported by Bitcoinist, the change introduced the tip of their 20-month-long authorized battle after the Fee revealed its plan to withdraw the litigation.
In 2023, the SEC alleged that the platform was an unregistered securities change, suing it for working as an unregistered broker-dealer, and legally promoting unregistered securities by way of its staking program.
Nonetheless, the company’s workers agreed in precept to drop the lawsuit final Friday, with solely the SEC’s Commissioners approval pending. Moreover, the Fee and Binance halted their authorized battle for 2 months, awaiting the SEC’s Crypto Activity Power actions, as they may facilitate the decision of this, and several other different crypto instances.
The regulatory company has additionally introduced the creation of the Oyber and Rising Applied sciences Unit (CETU), to guard buyers and fight misconduct associated to crypto and synthetic intelligence (Al).
Whole crypto market capitalization is at $3.04 trillion within the one-week chart. Supply: TOTAL on TradingView
Featured Picture from NBC Information, Chart from TradingView.com
