• The US Securities and Exchange Commission (SEC) has issued an investigative subpoena to Robinhood Markets regarding its crypto operations.
• This follows a similar subpoena from the California Attorney General’s office in December.
• Robinhood is cooperating with both investigations into its trading platform, custody of customer assets, customer disclosures as well as coin listing.
SEC Subpoena to Robinhood Over Crypto Operations
The US Securities and Exchange Commission (SEC) has issued an investigative subpoena to Robinhood Markets in regards to supported assets at its subsidiary Robinhood Crypto LLC, as well as its custody of cryptocurrencies and other platform operations. This follows a similar subpoena from the California Attorney General’s office in December which was related to their trading platform, custody of customer assets, customer disclosures as well as coin listing.
Reason for SEC Investigation
This move comes after the dramatic collapse of Sam Bankman-Fried’s crypto empire last year, for which he has since been charged with fresh criminal charges relating to political donations he made while running FTX. Furthermore, this is also due to the SEC maintaining that digital asset industry would not be spared by pre-existing securities laws and that several tokens meet the definition of a security.
Cooperation from Robinhood
Robinhood has stated that it is cooperating with both investigations and has filed a 10-K statement about the matter. Despite this their overall total revenue was affected by tumultuous market conditions in 2022 leading to a shrinkage of their crypto revenue during this time period.
Crypto Industry Reacts
The news has been met with some criticism from members within the cryptocurrency industry who have strongly opposed the SEC’s stance that certain tokens constitute securities under existing laws. However despite this many are hoping that these investigations will bring clarity on how digital asset regulations should be handled going forward or if they need further amendments or clarification on specific points within them.
It remains to be seen what action will be taken by both regulatory bodies following these subpoenas but it is clear that they are taking steps towards protecting investors’ interests when it comes to digital assets and bringing more clarity into how these regulations should be dealt with going forward.