Popular commission-free trading platform Robinhood is rethinking its support for multiple cryptocurrencies, according to the firm’s Chief Legal Officer Dan Gallagher, in light of the U.S. Securities and Exchange Commission’s (SEC) crackdown on crypto exchanges.
The SEC has recently filed a lawsuit against the Nasdaq-listed cryptocurrency exchange Coinbase, a day after filing a lawsuit against leading cryptocurrency exchange Binance.
Charges levied against Coinbase include operating as an unregistered broker and exchange, with the SEC demanding the company cease these actions permanently, while those against Binance include operating unregistered exchanges, broker-dealers, and clearing agencies, misrepresenting trading controls and oversight on the Binance.US platform, and the unregistered offer and sale of securities.
In its lawsuits, the SEC pointed to numerous crypto assets as securities, including Cardano’s $ADA and Solana’s SOL, among others. In total, the SEC has over a series of actions deemed over 60 digital assets to be securities, including Polygon ($MATIC), Cosmos ($ATOM), Axie Infinity’s $AXS, and $NEXO.
In the face of the regulator’s meticulous assessment, Robinhood is deeply contemplating its next steps, said Gallagher, who previously served as an SEC commissioner. His testimony was part of a meeting of the House Agriculture Committee dedicated to discussing digital assets, according to Bloomberg.
Robinhood users have the option to trade in a rather narrow range of 18 digital tokens, a stark contrast to the hundreds available on Coinbase and on Binance.
Notably, in an appearance on live television, SEC Chair Gary Gensler has unequivocally stated that he believes there is no need for additional digital currencies as “digital currency already exists in forms such as the U.S. dollar, the euro, and the yen.”
Gensler said the lawsuits against Coinbase and Binance were a long time in the making, due to the investigative work involved. The Chair of the SEC has also said the regulator has tried to talk to the platform to bring them into compliance.
It’s worth noting that Coinbase sued the SEC for clear cryptocurrency regulation. The SEC has tried to dismiss that lawsuit, indicating that establishing such rules could take years.
Featured image via Unsplash.
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