Robinhood said a regulatory probe of its cryptocurrency unit ended without incident.
The Securities and Exchange Commission (SEC) last year issued a Wells notice against the financial services platform, typically seen as a warning of pending enforcement action.
However, Robinhood said in a Monday (Feb. 24) press release that it got a letter from the SEC informing the company that the commission concluded its investigation and had no plans to follow up with enforcement action.
“We applaud the staff’s decision to close this investigation with no action,” Robinhood Chief Legal Officer Dan Gallagher said in the release. “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.”
Reached by PYMNTS, an SEC spokesperson declined to comment.
Robinhood’s announcement came days after another crypto firm, Coinbase, said the SEC was set to dismiss its lawsuit against the company.
“This would be a full dismissal, with $0 in fines paid and zero changes to our business,” CEO Brian Armstrong wrote in a post on social platform X.
The SEC sued Coinbase in June 2023, accusing the company of violating securities laws and arguing that Coinbase’s business “intertwines the traditional services of an exchange, broker and clearing agency” without registering those functions with the SEC, as required by law.
It was part of an ongoing crackdown by the SEC on crypto companies under the President Joe Biden administration. With the President Donald Trump administration in charge, however, attitudes toward crypto appear to be changing.
For example, the SEC last week announced it was replacing its Crypto Assets and Cyber Unit with a smaller group called the Cyber and Emerging Technologies Unit.
Robinhood was penalized by the SEC in January, although that measure came in the final days of the Biden administration.
The SEC said two Robinhood broker-dealers agreed to pay $45 million in combined civil penalties to settle charges that they failed to adhere to a “broad array” of regulatory requirements.
