NEWS
Robinhood Markets disclosed on Monday that it has received a “Wells notice” from the U.S. Securities and Exchange Commission (SEC), indicating potential enforcement action regarding its cryptocurrency trading operations.
While the notice doesn’t imply wrongdoing, it suggests the SEC is considering action against Robinhood. A Wells notice provides the recipient an opportunity to contest proposed charges before enforcement.
The SEC’s move against Robinhood follows similar actions taken against major crypto exchanges like Uniswap, Coinbase, and Binance. Robinhood contests the SEC’s stance, asserting that the cryptocurrencies it offers are not securities.
Dan Gallagher, Robinhood’s Chief Legal, Compliance, and Corporate Affairs Officer, stated, “We are confident that the assets listed on our platform do not constitute securities, and we are eager to engage with the SEC to highlight the flaws in any potential case against Robinhood Crypto.”
The SEC has maintained that most crypto tokens are securities, sparking disagreements with crypto companies over regulatory jurisdiction. Robinhood CEO Vlad Tenev affirmed the company’s readiness to defend its position legally if necessary.
This development underscores ongoing tensions between the SEC and major crypto platforms, which argue that cryptocurrencies don’t meet traditional securities criteria. Robinhood Crypto has been pursuing SEC registration for nearly two years to enhance compliance.
