In This Article:
Omar Marques / SOPA Images / LightRocket / Getty Images
Key Takeaways
-
Robinhood said Monday that the SEC has informed the company it won't receive an enforcement action over its cryptocurrency business.
-
The online trading platform received a Wells Notice last May, indicating penalties were possible following an investigation.
-
The SEC also told Coinbase last week it would look to dismiss a lawsuit against the crypto exchange.
Robinhood (HOOD) on Monday said it has been informed by the Securities and Exchange Commission that it won't receive any penalties over its cryptocurrency business.
The online trading platform said it received a letter from the SEC on Friday, informing Robinhood that the SEC's investigations is closed with no intention "to move forward with an enforcement action."
The regulator sent Robinhood a Wells Notice last May, informing the company that it had recommended an enforcement action over its crypto business. The Robinhood decision follows a similar move with Coinbase (COIN), which said last week that the SEC is seeking dismissal of a two-year-old lawsuit against the cryptocurrency trading platform.
An SEC spokesperson declined to comment on the Robinhood decision.
Robinhood Calls Move 'Return to The Rule of Law' at SEC
"Robinhood Crypto always has and will always respect federal securities laws and never allowed transactions in securities," Robinhood Chief Legal Officer Dan Gallagher said. "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.”
Executives in the crypto industry have been optimistic about U.S. President Donald Trump's second term being friendlier to the industry than President Joe Biden's administration was. SEC Chair Gary Gensler, who was criticized by the crypto industry as too harsh, stepped down in January. Trump has nominated Paul Atkins, an SEC chair under President George W. Bush, as Gensler's replacement, though he is still awaiting Senate confirmation.
Robinhood shares were down around 4% Monday morning. They have almost doubled in value since Trump's election win, recently hitting their highest point since the days following Robinhood's 2021 initial public offering.
Read the original article on Investopedia