Robinhood Markets has been served with a subpoena in connection with an SEC investigation into its crypto-related operations.
The SEC’s investigative subpoena was delivered to Robinhood a month after FTX declared bankruptcy. The zero-commission brokerage app said in its most recent 10K filings that it received the investigative subpoena in December, one month after crypto exchange FTX declared bankruptcy.
The subpoena concerned, among other things, Robinhood’s “cryptocurrency listings, custody of cryptocurrencies, and platform operations”. Robinhood also received similar subpoena requests from the California Attorney General’s office regarding Its trading platform, custody of customer assets, customer disclosures and coin listing. The company said it is cooperating with California’s investigation.
Many cryptocurrency trading and lending platforms declared insolvency in the crypto winter of 2022.Investigative subpoenas have been issued in regard to Robinhood’s crypto listings and custodial operations, the company reported, during the cryptocurrency bankruptcy of the previous year. Added was:
“In December 2022, following the 2022 Crypto Bankruptcies, we received an investigative subpoena from the SEC regarding, among other topics, RHC’s supported cryptocurrencies, custody of cryptocurrencies, and platform operations.”
In its filing, Robinhood warned that it might be required to halt trading in any cryptocurrency it supports if the SEC or a court finds them to be securities. Legal or administrative repercussions, customer responsibilities, and regulatory fines could all follow such a move.Following the filing, shares of Robinhood fell 0.5% in after-hours trading on Monday.
