The cryptocurrency unit of the American monetary companies firm Robinhood is now within the clear because the Securities and Alternate Fee (SEC) has closed its investigation into the enterprise.
In accordance with a weblog submit by Robinhood, the SEC revealed in a letter dated February 21 that it had wrapped up its investigation into the agency’s crypto operations and didn’t intend to carry any enforcement motion in opposition to the corporate.
SEC Closes Investigation In opposition to Robinhood
Recall that the SEC hit Robinhood with a Wells Discover in Could 2024, indicating a menace of authorized motion over the agency’s alleged securities violations.
CryptoPotato reported that Robinhood had allegedly violated Sections 15(a) and 17A of the Securities Alternate Act of 1934, which prohibited the corporate from inducing the sale of securities except registered with the SEC and defrauding prospects of their cash by materials omissions or misstatements.
Doable cures for the costs, if filed, included disgorgement, civil cash penalties, a cease-and-desist order, and limitations on actions. The Wells Discover got here 15 months after the SEC despatched an investigative subpoena to Robinhood relating to its crypto operations.
Whereas responding to the company’s actions final 12 months, Robinhood mentioned it was disenchanted as a result of it had made makes an attempt to register its enterprise and adjust to the company’s rules. Regardless, the corporate insisted that the SEC’s case was weak as a result of the property on its platform weren’t securities.
Within the current weblog submit asserting the Fee’s newest resolution, Robinhood maintained that it had made tough decisions to delist sure property categorized as securities underneath the previous SEC chair Gary Gensler, though it disagreed with the argument that almost all crypto transactions had been topic to federal securities legal guidelines.
Robinhood Maintains Innocence
However, the corporate acknowledged the transition from a interval of regulation by enforcement to a time of “regulation by regulation.” Crypto market members shall be supplied with a transparent regulatory framework, as promised by President Donald Trump throughout his election marketing campaign.
“We applaud the workers’s resolution to shut this investigation with no motion. Let me be crystal clear—this investigation by no means ought to have been opened. Robinhood Crypto all the time has and can all the time respect federal securities legal guidelines and by no means allowed transactions in securities,” Robinhood’s chief authorized officer Dan Gallagher mentioned, including “As we defined to the SEC, any case in opposition to Robinhood Crypto would have failed.”
In the meantime, Robinhood shouldn’t be the one crypto firm getting pardoned by the SEC. The securities company has paused its lawsuit in opposition to the crypto trade Binance and intends to withdraw an identical case in opposition to the buying and selling platform Coinbase.
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