It seems like almost every week these days there is a new announcement that the U.S. Securities and Exchange Commission (SEC) has pursued yet another crypto company for alleged securities violations. And the oppression shows no signs of slowing any time soon.
It covers all the crypto-related actions the SEC has taken recently, including confirmed Wells notices informing companies of impending enforcement actions, reported investigations, and summaries of some of the largest ongoing lawsuits. A handy to-do list for tracking your actions.
impending enforcement
Ethereum Foundation
Last week, a partially redacted portion of a lawsuit filed by Ethereum software company ConsenSys with the SEC revealed: bomb: Authorities have been secretly treating ETH as a security for over a year.
According to the complaint, the SEC is actively investigating a number of American companies for their involvement in the buying and selling of ETH. It is also reportedly investigating the company’s relationship with the Ethereum Foundation, a Swiss nonprofit organization that supports the Ethereum Foundation.
In February, the Ethereum Foundation itself A summons was issued By nameless “national authorities.” luck It did indeed report to the SEC, but the agency has not confirmed it.
To be clear, the SEC has not filed charges against any entity stemming from the “Ethereum 2.0” investigation. That’s part of the reason ConsenSys filed the complaint. preemptive lawsuit In April, it urged regulators to force the SEC’s hand and take an aggressive stance to address the issue of ETH’s legal status once and for all.
robin hood
On Monday, Robinhood Crypto, Robinhood’s digital asset arm, announced The company received a Wells Notice from the SEC, effectively a notice that the company will soon be sued for alleged securities violations.
The company said the subpoena it previously received from the SEC focused on the app’s list of cryptocurrencies and its storage practices. The Wells notice reportedly suggests that Robinhood Crypto will be sued for failing to register as a stock exchange and clearinghouse.
Robinhood is noteworthy Delisting Three crypto tokens, Cardano (ADA), Polygon (MATIC), and Solana (SOL), were issued after the SEC claimed in previous lawsuits against Coinbase and Binance that the tokens were securities. Robinhood is generally much more conservative than other industry players in what crypto tokens it lists in the US. For example, in New York, the app currently only facilitates the trading of 15 crypto tokens.
consensus
Although the SEC has not yet sued ConsenSys over the company’s relationship with Ethereum, the regulator issued a Wells Notice to the company in April regarding MetaMask, an Ethereum wallet developed by the software giant.according to counterclaim Weeks after ConsenSys’ lawsuit, the SEC plans to sue ConsenSys over two MetaMask features: the wallet’s cryptocurrency swapping feature and crypto staking service.
uniswap lab
On April 10, the SEC sent a Wells Notice to Uniswap Labs, the New York-based company that operates the Uniswap decentralized exchange (DEX). Inform The company announced it will soon face lawsuits for alleged securities violations.
Unlike previous lawsuits against crypto exchanges, the SEC’s impending lawsuit against Uniswap will specifically allege: DEXThese exchanges, which run on automated code and self-executing smart contracts, make up stock exchanges with rich intermediaries like Nasdaq and the New York Stock Exchange.
Famous events currently underway
coinbase
In one of the most high-profile crypto cases currently underway at the SEC, the regulator has been fighting the case against San Francisco-based cryptocurrency exchange Coinbase ever since. June of last year. The SEC accused Coinbase of operating as an unregistered securities exchange, broker-dealer, and clearing house. It also sued the company over its virtual currency staking service.
In March, Coinbase achieved success Sure A federal judge ended up throwing out part of the lawsuit alleging that the company engaged in intermediary activities through Coinbase Wallet. However, Coinbase was unable to throw out the remaining portions of the lawsuit, which will now proceed to discovery. Importantly, a March ruling determined that crypto exchanges like Coinbase fall under the jurisdiction of the SEC and that many of their tokenized assets likely constitute securities schemes.
Binance
The SEC’s lawsuit against Binance has progressed largely in parallel with the case against Coinbase, given that both large crypto exchanges filed their lawsuits within a day of each other. June of last year. Like Coinbase, Binance was also accused of operating as an unregistered securities exchange, broker-dealer, and clearing house. The exchange was also accused of failing to adequately restrict access to Binance.com, the company’s global cryptocurrency exchange, by U.S. customers who intended to use Binance.us. .
Binance founder Zhao Changpeng was also personally involved in the lawsuit. declared Mr. Zhao pleaded guilty last week to money laundering violations and was sentenced to four months in prison in the United States.
While Binance paid a historic amount of money, $4.3 billion fine The company has fought back aggressively against the SEC’s lawsuit to overcome its criminal money laundering woes. In December, exchange lawyers et al. pushed It will dismiss the case and, if it cannot, receive assurances that evidence relating to money laundering crimes admitted by the company will be excluded from the trial.
ripple
Perhaps the most intense legal battle ever fought by a crypto company against the SEC was brought by crypto token company Ripple Labs. XRP. Since 2020, the SEC has argued that Ripple’s sale of XRP constitutes an illegal unregistered offering of securities.
In one of the crypto industry’s most high-profile legal victories to date, a federal judge has ruled that: repetition Last year, it was announced that Ripple’s direct sales of XRP to consumers did not violate securities laws.Shortly after, the S.E.C. dismiss the complaint To the CEO and Executive Chairman of Ripple.
However, the judge overseeing the case ultimately ruled that the XRP provided by Ripple institutional The investors qualified as an unregistered securities scheme. The final verdict in this case will be decided soon. SEC required 2 billion dollars Ripple charges a fine.
kraken
9 months since the virtual currency exchange “Kraken” agreed The company took a hit after paying $30 million to the SEC to shut down its crypto staking program in the United States. another The November SEC lawsuit – similar to the lawsuits against Coinbase and Binance – alleges that Kraken is illegally operating as an unregistered securities exchange, broker-dealer, and clearinghouse.
Kraken is aggressively fighting back against this second SEC lawsuit and plans to join other U.S. crypto exchanges in filing suit. was fired.
Edited by Andrew Hayward
