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The Digital Chamber Criticizes SEC’s Actions Against Robinhood Crypto
The Digital Chamber, a prominent crypto trade association, recently issued a scathing condemnation of the U.S. Securities and Exchange Commission (SEC) for its decision to send a Wells notice to Robinhood Crypto, a subsidiary of the popular trading platform Robinhood.
In a statement released on May 6, the Digital Chamber expressed its “profound disappointment and concern” over the SEC’s actions, denouncing it as a classic example of regulatory overreach. The trade association highlighted its longstanding opposition to the SEC’s attempts to expand its regulatory authority without proper authorization from Congress.
The Digital Chamber emphasized that Congress is actively deliberating legislative measures to establish clear jurisdiction over the crypto industry, and accused the SEC of bypassing this process. As a solution to these jurisdictional disputes, the association called for “immediate legislative action” and demanded that SEC Chair Gary Gensler testify before Congress to address these concerns.
Supporting Companies and Investors
Defending Robinhood against the SEC’s allegations, the Digital Chamber acknowledged the company’s efforts to comply with regulations in good faith and its attempts to register with the SEC. The association declared its readiness to support Robinhood Crypto and other affected companies, although it did not specify any concrete plans to intervene in the legal proceedings.
The Digital Chamber stands ready to support Robinhood Crypto and other affected companies…
The trade association referenced its previous submission of an amicus brief in defense of Kraken in February as a sign of its commitment to advocating for fair treatment of crypto firms in regulatory matters.
Furthermore, the Digital Chamber argued that the SEC’s aggressive enforcement actions are contrary to its mandate of investor protection, contending that these measures hinder the growth of new companies and limit investors’ ability to make informed financial decisions independently.
Robinhood Responds to Wells Notice
Following the disclosure in a May 4 SEC filing that Robinhood Crypto had received a Wells notice, the company addressed the situation in a post on May 6. The Wells notice serves as a warning from the SEC about potential enforcement actions against the company, although no lawsuit has been filed yet.
Despite this development, Robinhood outlined its intention to engage with the SEC to challenge the allegations made and demonstrate the lack of merit in any potential case, both in terms of factual evidence and legal precedent. The company reiterated that the digital assets it offers are not classified as securities and affirmed its commitment to continue providing crypto-related services to its users.
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