U.S. SEC Serves Robinhood Crypto with Wells Notice

Robinhood Crypto confirms receipt of a Wells Notice from the U.S. SEC.

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  • The U.S. SEC has signaled a possible crypto enforcement action.
  • The regulator recently issued a Wells Notice to a crypto firm.
  • The company received the notice with discontentment.

Robinhood Markets announced Monday that the U.S Securities and Exchange Commission (SEC) had issued its crypto unit with a Wells Notice on May 4.

A โ€œWells Noticeโ€ is a formal letter sent by a securities regulator to a respondent informing them of the charges or enforcement action the agency intends to take against them. Typically, a Wells Notice gives the recipient the opportunity to respond to the letter’s contents in a written statement.

Robinhood Cryptoโ€™s Well Notice from SEC

According to a statement dated May 6, Robinhood Crypto (RHC) has received a Wells Notice from the SEC staff indicating that they would advise the commission to file an enforcement action against the entity based on alleged securities violations.

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Robinhood Markets compliance chief and Corporate Affairs Officer Dan Gallagher expressed discontentment with the SECโ€™s move, noting that the company was ready to demonstrate how weak any case brought by the regulator against Robinhood Crypto would be on โ€œboth the facts and the law.โ€

โ€œAfter years of good faith attempts to work with the SEC for regulatory clarity including our well-known attempt to โ€˜come in and register,โ€™ we are disappointed that the agency has decided to issue a Wells Notice related to our U.S. crypto business,โ€ Gallagher stated.

In defense, Robinhood Crypto said that it has often made difficult decisions to avoid listing tokens or crypto products that the SEC previously alleged are securities in public actions against other platforms. The company said it also heeded the SECโ€™s call and โ€œattempted to register a special purpose broker-dealer.โ€

Per the statement, the SECโ€™s move doesnโ€™t affect user accounts or services on Robinhood Crypto.

Read why Michael Saylorโ€™s speculation that the SEC will flag ETH, ADA, and SOL as securities:
Michael Saylor Warns SEC to Flag ETH, ADA, SOL as Securities

Stay updated on the Philippines SEC plan to regulate crypto:
Philippines Eyes Crypto Regulation Guidelines by Year-End

This article is for information purposes only and should not be considered trading or investment advice. Nothing herein shall be construed as financial, legal, or tax advice. Trading forex, cryptocurrencies, and CFDs pose a considerable risk of loss.

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Brian Danga

Brian Danga is a crypto reporter at DailyCoin covering breaking news. Brian has minor holdings in Bitcoin and Ethereum.

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