The U.S. Securities and Exchange Commission (SEC) has officially ended the investigation into Robinhood Crypto (RHC) without pursuing any enforcement action. In a letter dated February 21, 2025, the SEC’s Enforcement Division informed Robinhood that it had concluded its inquiry following a Wells Notice issued to the company in May 2024.
Robinhood Markets, Inc.’s Chief Legal, Compliance, and Corporate Affairs Officer, Dan Gallagher, expressed satisfaction with the outcome, stating, “We applaud the staff’s decision to close this investigation with no action.” Gallagher criticized the initial launch of the investigation, maintaining that Robinhood Crypto consistently complied with federal securities laws and did not facilitate transactions in securities.
Regulatory Disputes Over Digital Assets
The investigation centered on the classification of digital assets as securities, an area of ongoing debate between cryptocurrency platforms and regulators. Robinhood has consistently argued that most digital assets are not subject to federal securities laws. Unlike some competitors, Robinhood Crypto chose not to offer specific products and services that the SEC, under former Chair Gary Gensler, had suggested were securities.
With the investigation now closed, Robinhood expressed a desire to engage with the SEC’s new leadership to develop a clearer regulatory framework for digital assets. The company called for “regulation by regulation” instead of “regulation by enforcement,” emphasizing the need for transparent and tailored rules for the digital asset industry.
Looking Forward Amid Regulatory Uncertainty
The closure of the SEC investigation marks a significant regulatory victory for Robinhood as it continues to navigate the evolving digital asset landscape. The company remains focused on innovating its products and services while advocating for clearer regulatory guidelines.
The SEC’s decision not to pursue enforcement action allows Robinhood to move forward without legal hindrances. As the company seeks to influence digital asset regulation, industry stakeholders will be closely watching for any new developments in the regulatory approach taken by the SEC under its current administration.
