2024-10-09
Crypto.com Has Filed Suit Against the SEC to Protect the Future of Crypto in the U.S.
On October 8, 2024, Crypto.com has filed
a lawsuit against the U.S. Securities and Exchange Commission (SEC) after
receiving a Wells notice, which is a warning of impending legal action.
Crypto.com has initiated legal action
against the U.S. Securities and Exchange Commission (SEC) and its Chair, Gary
Gensler. The lawsuit follows the receipt of a Wells Notice that was sent by the
SEC on Aug. 22, which is a formal indication that the SEC may be considering
enforcement action.
The company acted in response to
receiving a Wells notice from the SEC, part of the agency's ongoing enforcement
actions. Crypto.com argues that the SEC has unlawfully expanded its
jurisdiction by classifying most crypto transactions as securities, excluding
Bitcoin (BTC) and Ethereum (ETH), without following proper legal procedures.
The lawsuit aims to halt the SEC's unauthorized actions.
Additionally, Crypto.com’s affiliate,
Crypto.com | Derivatives North America (CDNA), filed a petition with the CFTC
and SEC to clarify the regulation of certain cryptocurrency derivative
products. The petition seeks joint rulemaking under the Dodd-Frank Act,
requesting clear guidance on which agency regulates these products.
Crypto.com emphasizes its strong
commitment to compliance, holding various U.S. regulatory licenses and
registrations, and sees this legal challenge as necessary to protect the crypto
industry's future. The company believes the U.S. courts will provide a
necessary check on the SEC's actions, reinforcing its compliant operations and
benefiting the broader crypto sector.
Crypto.com's CEO, Kris Marszalek,
stated that the SEC's actions are unauthorized and jeopardize the future of the
crypto industry in the U.S. The company is seeking to protect the crypto
industry from what it views as overreach by the SEC.
Crypto.com's case seeks to prevent SEC
from unlawfully expanding its jurisdiction over secondary-market sales of
certain network tokens sold on the exchange. This move has garnered attention
as it represents a broader contention within the crypto community against what
they perceive as the SEC's overreach in its regulatory approach. The outcome of
this lawsuit could have significant implications for the regulation of cryptocurrency market in the United States.
