RobinHood markets Inc. has been subpoenaed by the U.S. Securities Alternate Fee (SEC) over its cryptocurrency listings. In a Monday 10-Ok submitting with the SEC, the monetary providers firm stated that the Fee was investigating its crypto arm enterprise Robinhood Crypto LLC.,  the agency behind the favored buying and selling app. That is the most recent proof of the regulator’s deterministic crackdown on crypto buying and selling platforms. 

Seems to be just like the SEC is pointing its subsequent arrow at Robinhood.

What’s the Sheriff after? I do not assume Robinhood even has a staking program, does it?

Robinhood has a LOT of Ethereum although… simply saying. https://t.co/qu8IYgsRP0

— Jeremy Hogan (@attorneyjeremy1) February 27, 2023

In keeping with RobinHood, the company subpoenaed it in December due to its crypto custody providers, cryptocurrency listings, and platform operations. The Menlo Park California-based crypto agency discloses potential dangers its enterprise could face due to the SEC’s subpoena. 

For instance, if a court docket or the SEC says that any of its crypto listings have been securities, then the corporate may very well be blocked from “persevering with to facilitate buying and selling of these cryptocurrencies (together with ceasing assist for such cryptocurrencies on our platform),” stated RobinHood within the submitting. 

In the mean time, the change lists 18 cryptocurrencies on its platform, together with Bitcoin (BTC), Ethereum (ETH) and Dogecoin (DOGE). Traders should buy as little as $1 value of crypto to get began. 

A subpoena is a authorized doc requiring an individual to look earlier than a choose to testify or produce some paperwork essential to the case whereas the investigation remains to be happening. 

This isn’t the primary time that Robinhood is being investigated by the U.S. authorities or has been subpoenaed. The corporate stated it was additionally subpoenaed by the California Lawyer Common’s workplace in April 2021 concerning its crypto change providers, coin itemizing and buyer disclosures. RobinHood stated that it was cooperating with state investigators. 

Talking to Decrypto, a RobinHood spokesperson stated:

We now have nothing extra to share right here past what’s within the submitting.

The RobinHood-FTX Nexus

The collapse of Sam Bankman Fried’s empire FTX in November 2022 initiated a string of crypto firm failures which sparked a market-wide sell-off. This noticed billions of {dollars} wiped from the cryptocurrency house in lower than every week and left collectors going through immense losses.

Not lengthy after, FTX filed for Chapter 11 Chapter safety, which led to interventions from regulators across the globe and cemented the doom the sector was already going through following the collapse of the Terra Ecosystem earlier that yr. Investor sentiment within the house was dealt a blow as crypto costs bled underneath the results of the crypto winter. 

The SEC has since doubled down on its stance that the present securities legal guidelines additionally apply to digital currencies. The SEC Chair Gary Gensler is cracking down on all of the cryptocurrencies and tokens he believes are unregistered securities. He has made it clear that he believes many cryptocurrencies match the outline of a safety, besides Bitcoin. 

SEC Chair Gary Gensler Doubles Down on Stance That Each Crypto Asset Is a Safety Besides Bitcoin (BTC) https://t.co/bisNuxTlje

— The Day by day Hodl (@TheDailyHodl) February 28, 2023

Earlier final month, RobinHood disclosed plans to reclaim its shares from Sam Bankman-Fried’s holding firm Emergent Constancy Applied sciences as a result of U.S. authorities have been within the technique of taking maintain of its shares tied to the previous FTX chief government officer. 

RobinhHood will not be the one crypto agency the SEC has on its radar. At first of the yr, the regulator charged Gemini and Genesis for providing unregistered securities. And earlier in February, the Fee fined the San Francisco-based crypto change Kraken $30 million for violating securities legal guidelines.

After the information of RobinHood being subpoenaed by the SEC, its share dropped 0.6% within the prolonged session Monday. On the time of writing, $HOOD is hovering round $10.07, up 3.6% within the final 24 hours, in accordance with knowledge from Google Finance. 

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