In response to the recent regulatory crackdown by the U.S. Securities and Exchange Commission (SEC) on major crypto exchanges Binance and Coinbase, Robinhood is actively reconsidering its cryptocurrency offerings, Bloomberg report revealed.
The SEC has sued Binance and Coinbase, labeling over a dozen digital assets listed on the exchanges as unregistered securities. The agency alleges that Binance and Coinbase have violated securities law by allowing U.S. customers to trade assets worth over $120 billion, putting investors at risk.
In light of these developments, Robinhood’s Chief Legal Officer, Dan Gallagher, informed Congress that the brokerage firm is reviewing its crypto offerings. The firm aims to review the SEC’s analysis to determine what actions, if any, to take.
Robinhood currently allows its users to trade around 18 different digital assets, a significantly smaller number compared to hundreds of options available on Binance and Coinbase. Notably, some of these assets, including Solana (SOL), Cardano (ADA), and Polygon (MATIC), were named as unregistered securities by the SEC in its recent lawsuits against Binance and Coinbase.
Also Read: SEC’s Move: 61 Crypto Tokens Now Classified as Securities
No cryptocurrencies have been delisted by Robinhood as of yet. However, if Robinhood determines that it could face legal action over these tokens, they are likely to be removed from the platform.
The potential delisting could have a significant impact on the price of these major crypto tokens. In Q1 2023, Robinhood reported crypto revenues of $38 million, less than 10% of its total net revenues of $441 million. Despite the SEC’s actions, larger cryptos like Bitcoin and Ethereum, as well as substantial Proof-of-Work tokens such as Litecoin and Dogecoin, were not mentioned in the lawsuit.
As the situation continues to evolve, the future of these digital assets on Robinhood and other major exchanges remains uncertain.
