U.S. crypto companies, including Robinhood, Coinbase, and OpenSea, are experiencing relief as the U.S. Securities and Exchange Commission (SEC) eases its regulatory stance on the industry.
SEC Ends Investigation Into Robinhood’s Crypto Business
On Monday, Robinhood announced that the SEC had concluded its investigation into the company’s crypto operations. This move clears the path for Robinhood to expand its presence in the digital asset market, as regulatory pressure on crypto firms under the Trump administration decreases.
Robinhood, a popular trading app that has donated $2 million to Trump’s inauguration, is currently trading at around $50 per share. The company’s crypto transactions now make up over half of its transaction revenue, which recently surged to $358 million—a 700% increase.
Regulatory Shifts Amid Trump Administration
The regulatory changes are part of a broader shift under the Trump administration, which is scaling back lawsuits against crypto firms. Charles Wayn, co-founder of the decentralized app Galxe, commented on the change: “The SEC is dropping lawsuits against crypto companies left, right, and center. First Coinbase, now Robinhood and OpenSea—it’s like a completely different agency.”
On Friday, Coinbase revealed that the SEC was close to dismissing a 2023 lawsuit against the exchange. Similarly, OpenSea, the largest NFT marketplace, reported that the SEC’s investigation into the company was closing, without categorizing NFTs as securities.
Industry Concerns Over Political Influence
The crypto industry has contributed millions to Trump’s 2024 presidential campaign, sparking questions about whether donations influenced the shift in regulatory stance. Robert Weissman, co-president of the watchdog group Public Citizen, said, “The SEC abandonment of its case against Coinbase is proof positive that the crypto industry’s flood of campaign spending has paid off.”
Weissman expressed concern that the SEC’s lenient approach could place consumers at risk and potentially threaten the financial system. In 2023, Coinbase spent over $46 million supporting pro-crypto candidates, including Trump, while OpenSea spent more than $100,000 lobbying for the 2024 elections.
Continued Focus on Fraud and Consumer Protection
Despite the easing of regulatory pressure, experts believe enforcement actions against firms will continue, particularly in cases of fraud. Katherine Snow, General Counsel at Bitcoin firm Thesis, noted, “Enforcement is still in play where fraud is concerned – as it should be – but the SEC agency is no longer behaving like an attack dog, but rather like the maître d’ at Zero Bond, letting the right members through.”
Maria Carola, CEO of StealthEx, added, “This does not imply full freedom for crypto companies, as the focus is likely to pivot from broad regulatory crackdowns to targeted enforcement against fraud and consumer protection violations.”
Awaiting Regulatory Clarity
While the SEC’s actions signal a shift in how the agency is handling crypto firms, the sector is still awaiting regulatory clarity. Cathy Yoon, General Counsel at Wormhole Foundation, noted, “While dismissals of cases or investigations may be quick now, the hard work in solidifying clarity will take time.” The industry is waiting for more definitive answers on how crypto will be legally categorized and which agency will oversee digital assets.
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