The US Securities and Exchange Commission (SEC) reportedly served an investigative subpoena on Robinhood Markets in December. The agency’s action is part of a broad campaign against the digital asset sector that has been launched in response to Sam Bankman-Fried’s crypto empire collapse last year. The criminal charges against the disgraced cryptocurrency tycoon stem from political donations he made while in control of FTX.
The subpoena relates to the supported assets at its subsidiary Robinhood Crypto LLC, as well as to its custody of cryptocurrencies and other platform operations, according to its most recent 10-K filing.
The SEC previously argued that the existing securities regulations would apply to the digital asset market as well, indicating that some tokens fit the definition of security, a position that the crypto industry adamantly disagreed with. However, this is not the first time a regulatory body in the nation has subpoenaed Robinhood. The California Attorney General’s office submitted a similar subpoena request involving its trading platform, asset custody for customers, client disclosures, and coin listing. The platform claimed to be helping with their inquiry.
Due to volatile market conditions in 2022 that slowed down its total trading activities, Robinhood’s crypto earnings decreased.
A $30 million fine was also levied last summer by the New York State Department of Financial Services (NYDFS) in response to claims that it had broken cybersecurity and anti-money laundering rules.
Yet the California-based investing platform got off to a good start in 2023. Its crypto trade volume increased by 95% from $1.9 billion in December to $3.7 billion in January.
