Robinhood has announced that the US Securities and Exchange Commission (SEC) has closed its investigation into the exchange and will not pursue any enforcement action.
The development comes just days after the SEC dropped its investigation into Coinbase.
Robinhood Celebrates SEC’s Decision to End Crypto Investigation
The SEC’s Enforcement Division informed Robinhood that the investigation into its crypto unit was concluded. This follows a Wells Notice from the SEC in May 2024.
Robinhood expressed relief at the SEC’s decision.
“Let me be crystal clear—this investigation never should have been opened. Robinhood Crypto always has and will always respect federal securities laws and never allowed transactions in securities. As we explained to the SEC, any case against Robinhood Crypto would have failed. We appreciate the formal closing of this investigation, and we are happy to see a return to the rule of law and commitment to fairness at the SEC,” said Dan Gallagher, Robinhood’s Chief Legal Officer.
A Wells Notice is a formal communication from the US SEC that informs a company or individual that the Commission plans to recommend enforcement action against them. It’s a preliminary warning that the SEC has found sufficient grounds to believe that securities laws have been violated.
In 2024, the SEC sent a Wells Notice to several crypto companies, including Immutable, Uniswap, Crypto.com, and others. Uniswap’s UNI token even suffered a significant loss in value after the notice. Crypto.com also filed a lawsuit against the SEC after receiving the notice, which it later dropped after Donald Trump’s election victory.
However, under the new leadership, the SEC has vowed to lower its enforcement actions against crypto, and this is materializing. Last week, the Commission also dropped its investigation against NFT marketplace Opensea.
Similarly, on February 21, Coinbase CEO Brian Armstrong announced that the SEC was dropping its 2023 lawsuit.
“Great news! After years of litigation, millions of your taxpayer dollars spent, and irreparable harm done to the country, we reached an agreement with SEC staff to dismiss their litigation against Coinbase. Once approved by the Commission (which we’re told to expect next week) this would be a full dismissal, with $0 in fines paid and zero changes to our business,” he said.
The SEC’s dismissal of the Coinbase and Robinhood cases points toward the favorable regulatory environment promised by the current US administration.
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