The United States Securities and Exchange Commission (SEC) has officially told Robinhood that it was closing the investigation into the company.
According to a statement sent by the agency and released by Chief Legal Officer Dan Gallagher, the SEC was halting the investigation and would not pursue further enforcement action against the company. Gallagher mentioned that he supported the agency’s move, noting that the investigation should not have started in the first place.
SEC drops its investigation into Robinhood Crypto
According to Gallagher, the platform has always adhered to federal securities law, refusing to allow the trading of securities on it. He added that the SEC would have lost in court if it had proceeded with the move.
“As we explained to the SEC, any case against Robinhood Crypto would have failed. 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,” he said.
Robinhood was issued a letter in May 2024, with the SEC noting that it may be charged for violating securities law. The company was also previously subpoenaed for its crypto listings, custody, and platform operations.
Despite “years of good faith attempts to work with the SEC for regulatory clarity including our well-known attempt to ‘come in and register,’” Dan said at the time.
At the time, former SEC boss Gary Gensler accused many platforms of allowing traders to trade securities without due registration. Robinhood, on its part, made several tough calls by turning down assets so it would not violate the securities law.
Robinhood, through Gallagher, mentioned that the company wanted regulators to come up with clearer rules, noting that the firm supports regulation from the official channels and not enforcement after companies had already built the products.