The development is the latest in a slew of recent crypto-focused actions from the SEC.
The United States Securities and Exchange Commission (SEC) has issued a subpoena to the American trading platform Robinhood over its crypto listings. The recent development was brought to public light by Robinhood through its latest 10-K filing with the SEC.
Fox Business journalist Eleanor Terrett also highlighted the story.
🚨BREAKING: The @SECGov has issued a subpoena to @RobinhoodApp over its cryptocurrency listings.
— Eleanor Terrett (@EleanorTerrett) February 27, 2023
The subpoena specifically requests information about the platform’s custody measures, as well as its operations related to the assets it currently lists.
Robinhood further revealed that the investigative subpoena, which is one of the factors that could damage its brand, was served to them following the bankruptcies that rocked the crypto scene last year. The platform noted that it could be forced to delist cryptocurrencies regarded as securities by the SEC or a court.
Robinhood currently accommodates 18 different cryptocurrencies on its platform, including Bitcoin (BTC), Ethereum (ETH), Shiba Inu (SHIB), and Dogecoin (DOGE). Much like Coinbase, the platform does not provide support for XRP. Several market watchers have attributed this to the legal situation surrounding the asset.
Notwithstanding, due to the lack of regulatory clarity within the local crypto industry in the United States, American-based platforms such as Robinhood have little idea of where they stand in relation to the law with regard to their cryptocurrency listings.
SEC Chair Gary Gensler recently disclosed why he believes most crypto assets, other than Bitcoin, are securities, in an interview with Intelligencer. Last December, U.S. Congressional candidate January Walker advised the crypto industry to support XRP against the SEC’s perceived overreach, warning that it could affect the whole industry soon.
Industry players have bemoaned this unclarity especially recently that the SEC has taken a particular interest in the crypto scene following the FTX implosion. Entities such as Kraken and Paxos have been caught up in the regulatory watchdog’s recent crackdown.
Recall that Terrett revealed on Feb. 9 that Gensler plans to embark on a “midnight massacre” aimed at bringing the crypto scene under his control. She warned of a cluster of enforcement actions in the coming weeks from the SEC, the New York Department of Financial Services, and The Office of the Comptroller of the Currency.
🚨SCOOP: @GaryGensler is embarking on a "midnight massacre" in an attempt to bring all of #crypto under his control. In the coming weeks, the @SECGov, @NYDFS and the @USOCC will be bringing a myriad of enforcement actions against exchanges, banks
— Eleanor Terrett (@EleanorTerrett) February 9, 2023