Coinbase co-founder and CEO Brian Armstrong welcomed Robinhood (NASDAQ:HOOD) to the Wells Notice club.
This past week, it was reported that Robinhood has received a Wells Notice from the Securities and Exchange Commission (SEC). A Wells Notice indicates that SEC staff is recommending an enforcement action by the Commission. The Notice directly relates to Robinhood Crypto. Coinbase is also the target of an SEC investigation.
Armstrong stated:
“Welcome to the club – you’re in good company 🙂 The courts will help get clarity – but the right solution longer term is we need to elect pro-crypto candidates. This is why Coinbase has supported Fairshake Superpac and StandWithCrypto.org. Hope y’all can join us!”
Armstrong was responding to an X from Vlad Tenev, CEO and co-founder of Robinhood, who posted:
“Over the last three years, we’ve reached a state of regulatory onslaught that is harmful to American companies and consumers. The SEC’s continued attack on crypto, coupled with recent rule proposals like the one related to predictive data analytics, mark yet another improper attempt by the administrative state to stifle innovation … While we strive to maintain positive and productive relationships with our regulators, if necessary we will use our resources to contest this matter in the courts, with the intent of both defending our crypto business and establishing regulatory clarity in the United States for the benefit of our customers.”
The X chatter highlights a frequent complaint on social media that the SEC has chosen a path of regulation by enforcement instead of creating bright line rules for the digital asset sector. The SEC under the leadership of Chairman Gary Gensler has frequently stated that all digital assets are securities. But questions remain as firms seek to provide a regulated path that accommodates the nuances of crypto.
Chairman Gensler was on CNBC today, defending his stance while refusing to answer a direct question as to whether or not Ethereum is a security – something the SEC previously declared was not a security during the previous administration.
