The SEC Plans to Sue Robinhood

Trading platform Robinhood received a Wells Notice in which the U.S. Securities and Exchange Commission (SEC) accused it of violating securities laws. The allegations affected Robinhood’s share price, which instantly fell by 2.5%.

The U.S. Securities and Exchange Commission (SEC) issued a Wells Notice to Robinhood, a popular trading platform. According to court filings, the SEC investigated the platform’s listing and storage of specific cryptocurrencies.

The opinion states that the SEC representatives plan to file a lawsuit against Robinhood for violating U.S. securities laws. Dan Gallagher, Chief Legal, Compliance, and Corporate Affairs Officer at Robinhood Markets, Inc., said that the company is seeking a direct dialog with the SEC as none of the crypto-assets on the platform are securities, and the company’s lawyers are ready to prove this to the regulator.

Notably, Gallagher also emphasized that Robinhood attempted to register with the SEC as a special broker-dealer shortly before receiving the Notice.

The reports of the regulator’s intentions negatively impacted the company’s stock price, which fell by 2.5% immediately after the Wells Notice was released. However, following Robinhood’s statement of intent to confront the SEC, the company’s stock prices returned to their previous levels.

Threats from the SEC previously received many crypto companies in the United States, including crypto exchanges Binance, Coinbase, Bittrex, Kraken, KuCoin, and Uniswap.

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