The United States Securities and Exchange Commission (SEC) has issued a Wells Notice to the crypto subsidiary of Robinhood. In a Monday announcement, Robinhood confirmed the receipt of the Wells Notice but claimed that the regulator had made a preliminary determination to recommend an enforcement action against its crypto unit.
Robinhood, however, expressed disappointment in the agency’s decision to issue Wells Notice to its crypto businesses in the U.S. According to the brokerage firm, it tried its best for several years to collaborate with the SEC to ensure regulatory clarity.
Its Chief Legal Compliance and Corporate Affairs Officer, Dan Gallagher insisted that the said assets listed on its platform are not securities. He emphasized Robinhood’s commitment to engaging with the SEC to prove that it has not violated any securities laws.
In the press release, Robinhood added that it made difficult decisions not to list some tokens. Likewise, the exchange does not offer products like staking and lending that are described as securities by the SEC. Robinhood also reflected on how it heeded the agency’s calls by attempting to register as a special-purpose brokerage.
SEC served subpoena to Robinhood in 2023
Don’t forget that the SEC had earlier served subpoena to Robinhood over the conduct of its crypto business. Then, Robinhood hinted that the legal action by the agency could force it to stop digital asset trades on its platform.
Meanwhile, Robinhood’s crypto business has been growing rapidly since 2023. Recently, the brokerage launched the Android version of its mobile crypto wallet, making it accessible to more users. The wallet features Web3 tools to aid users’ experience and make it the most reliable solution for traders.
Before launching the Android version, Robinhood had earlier launched the iOS version of the wallet. Then, the Android version was in its beta version.
In 2023, as part of its efforts to expand its business focus, Robinhood bought San Francisco credit card service XI. Then, the brokerage said the acquisition of XI will help it to provide its users with more access to credit. Describing XI as a firm that provides a no-fee credit card service, Robinhood was optimistic its acquisition would strengthen its relationship with its users.
Read More: