SEC crypto crackdown continues with Robinhood as lawsuit looms

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Continuing its crackdown on cryptocurrency exchanges, the Securities and Exchange Commission (SEC) may potentially sue Robinhood Markets over securities violations alleged in the popular investing app’s crypto unit, Robinhood Crypto said Monday.

In a recent SEC filing, Robinhood Markets Chief Financial Officer Jason Warnick confirmed that Robinhood Crypto has received investigative subpoenas from the SEC regarding its “cryptocurrency listings, custody of cryptocurrencies, and platform operations.”

Despite Robinhood cooperating with these investigations, the SEC sent a “Wells Notice” on Monday, the filing said. The notice alerted Robinhood that SEC staff had made a “preliminary determination” recommending that the SEC “file an enforcement action” alleging that Robinhood Crypto had violated the Securities Exchange Act of 1934.