SEC Ends Investigation Without Charges
Robinhood announced that the U.S. Securities and Exchange Commission (SEC) has concluded its investigation into the company’s crypto trading unit without taking enforcement action. The SEC’s Enforcement Division notified Robinhood via letter, marking the end of an inquiry that had been ongoing since 2024.
The investigation stemmed from a Wells Notice issued by the SEC in May 2024, indicating potential charges against Robinhood Crypto. However, the regulator ultimately decided not to pursue legal action, effectively clearing the company of wrongdoing.
Robinhood’s Chief Compliance and Corporate Affairs Officer, Dan Gallagher, welcomed the decision:
“We appreciate the formal closing of this investigation and are happy to see a return to the rule of law and fairness at the SEC.”
Robinhood’s Regulatory Stance and Business Growth
Throughout the inquiry, Robinhood consistently argued that most digital assets are not securities and that SEC allegations were unwarranted. Unlike some competitors, Robinhood chose to exclude certain crypto products to avoid regulatory scrutiny.
Despite regulatory uncertainty, Robinhood’s crypto trading business surged in Q4 2024, recording:
- $70 billion in crypto trading volume (a 400% year-over-year increase)
- $358 million in crypto revenue (a 700% surge from the prior year)
- A 200% rise in total transaction-based revenues
Robinhood has also expanded its crypto offerings, adding seven new assets in the U.S. and launching Ethereum staking in the EU.
With the SEC dropping its case, Robinhood’s regulatory troubles appear to be easing, potentially allowing the platform to expand its crypto services further.
