Regulatory

The commission-free trading website Robinhood, which lets users exchange stocks, options, and cryptocurrencies, has received a subpoena from the Securities and Exchange Commission (SEC) of the United States. The demand relates to the business’s cryptocurrency trading operations.

With millions of users purchasing and selling cryptocurrencies on the app, Robinhood has been at the forefront of the cryptocurrency trading revolution. The business has previously come under fire for its lack of regulation compliance and transparency in the cryptocurrency industry.

The SEC’s action is a part of a larger campaign against activities connected to cryptocurrencies. Initial coin offerings (ICOs) and cryptocurrency exchanges are just two examples of the businesses the agency has been actively pursuing that provide services and products connected to cryptocurrencies.

“Recently, the International Monetary Fund (IMF) took yet another action to undermine the cryptocurrency market. The group opposed the use of cryptocurrencies as legal tender in a statement made public on Wednesday.

Allowing cryptocurrencies to become legal tender would put financial stability, consumer protection, and the integrity of the financial system at serious risk, according to the IMF, a global organisation of 190 nations that works to advance international monetary cooperation and financial stability.”

New York Attorney General Letitia James said that CoinEx’s “illegal conduct” had put New York investors at risk. “CoinEx’s failure to register with the DFS has left New York investors vulnerable to fraud and other forms of financial abuse,” James said. “We will not tolerate this type of illegal conduct in our state, and we will use every tool at our disposal to hold companies accountable for their actions.”

The SEC is taking measures to regulate digital assets and is now focusing its attention on banks’ involvement in the crypto market. The agency has contacted several major banks, warning them about the potential risks associated with investing in or providing services to cryptocurrency-related businesses. SEC Chairman Gary Gensler emphasized that the agency is focused on protecting investors and ensuring that the financial system is safe and sound, and is particularly concerned about cryptocurrencies marketed as securities but not registered with the SEC.

The SEC is taking action to regulate the crypto industry, specifically focusing on hedge funds and their potential for insider trading and market manipulation. The agency has issued subpoenas to a number of funds, requesting information about their investments in crypto firms and trading activities related to cryptocurrencies. While some in the industry see this as overly aggressive regulation, others believe it is necessary to protect investors and prevent fraud.