Prominent crypto law experts have expressed opposition to the recent surge in the U.S. Securities and Exchange Commission's issuance of wells notices to crypto companies.
This reaction comes after Robinhood acknowledged that it had received such a notice to its crypto division. Jake Cherbinski, Chief Legal Officer of Valiant Funds, said: Posted In X, the SEC has just sent a Wells notice to Robinhood.
He added: “The numbers they've sent us regarding cryptocurrencies in recent months is staggering. It's hard to imagine that they would take (or be able to bring) so many enforcement actions at once. They are currently… It appears they are using the Wells process as a scare tactic.
Rodrigo Silva Herzog, a former Paradigm special counsel and current special counsel at Cooley Law Firm, expressed similar sentiments about the SEC's approach. He asked the following questions about X: “The SEC continues its carpet bombing campaign against cryptocurrencies, issuing new wells to Robinhood. At this point, you have to wonder if Gensler has bitten off more than he can chew.”
Cherbinski argued that the SEC's focus on cryptocurrencies rather than stock and bond markets is disproportionate. He warned that the SEC would be in violation of its legal obligations if it took many enforcement actions as the Wells notice sent.
Alternatively, he suggested that the SEC may be abusing the Wells process to unfairly monitor and intimidate legitimate U.S. companies.
According to a Form 8-K filing early Monday, Robinhood revealed that the SEC plans to file an enforcement action against its cryptocurrency division charging securities violations.
Dan Gallagher, Robinhood's chief legal, compliance and corporate affairs officer, expressed doubts about the suit's validity. He emphasized his belief that the assets on his platform are not securities and that he is willing to work with the SEC to effectively and legally prove weaknesses in potential lawsuits against Robinhood Crypto. expressed.
The SEC sent a Wells Notice to Uniswap last month. The SEC also sent a Wells Notice to Ethereum development studio ConsenSys in April.
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