The United States Securities and Exchange Commission (SEC) has concluded its investigation into Robinhood Crypto (RHC) without pursuing enforcement action. The investigation began after Robinhood received a Wells Notice from the SEC in May 2024.
This announcement concludes the investigation into potential securities law violations related to its crypto activities.
Robinhood and SEC Investigation
During the last administration, the SEC developed a reputation for a more comprehensive approach to cryptocurrency startups under former head Gary Gensler.
Consequently, Robinhood received a subpoena regarding its platform operations, custody procedures, and bitcoin listings.
Conversely, the company argued that it had never encouraged securities trades and had regularly followed federal securities rules.
The SEC’s Enforcement Division sent a letter to Robinhood on February 21, 2025, informing it that the inquiry had closed and that no enforcement action would be taken.
This ruling follows a similar decision on Coinbase and OpenSea, indicating a more favorable legislative environment for the cryptocurrency industry.
Positive Investor and Market Attitude
Nearly half of Robinhood’s $672 million in transaction-based income in the fourth quarter of 2024 came from a startling 700% rise in earnings connected to trading.
Thus, the announcement coincides with Robinhood experiencing significant growth in earnings from cryptocurrency trading.
Following the announcement and an existing 38% growth in 2025, the company experienced nearly a 2% rise in pre-market trading.
The expansion reflects investor hope for the company’s future in the crypto market.
Moreover, other exchanges could feel more comfortable including a wider spectrum of tokens on their platforms, increasing trading volumes overall. This could also motivate additional cryptocurrency companies to go public on American stock markets.
The move indicates a potential shift towards a more balanced approach to crypto oversight that aims to promote innovation while preserving required oversight.
