Robinhood May Narrow Crypto Offerings in Response to SEC Actions

• Robinhood is reassessing its cryptocurrency offerings following recent SEC actions.
• The SEC has identified certain cryptocurrencies such as Solana, Cardano, and Polygon listed on Robinhood as unregistered securities.
• This development coincides with the ongoing debate about cryptocurrency regulation, including a recent congressional debate on a draft bill.

In the wake of recent actions by the U.S. Securities and Exchange Commission (SEC), Robinhood Markets Inc. is reassessing its cryptocurrency offerings. Dan Gallagher, Robinhood’s legal chief, and a former SEC commissioner, informed Congress of this review during a meeting centered on digital assets.

In a bid to avoid any conflicts with the SEC, Robinhood is reportedly contemplating delisting certain cryptocurrencies such as Solana, Cardano, and Polygon. These are among the 18 cryptocurrencies currently listed on Robinhood, compared to hundreds on Coinbase. They have been identified as unregistered securities by the SEC, raising the potential for legal implications​​.

The potential delisting of these popular cryptocurrencies could greatly impact Robinhood’s users, as the platform only supports a limited selection of 18 cryptocurrencies, compared to hundreds on Coinbase. This list currently includes Cardano, Solana, and Polygon, all of which were added to Robinhood less than a year ago as part of an expansion in the platform’s crypto offerings.

If the lawsuit is successful, and these cryptocurrencies are determined to be securities that have not been properly registered, Robinhood may be required to delist these cryptocurrencies to stay compliant with U.S. securities laws.

The latest developments also reveal that Coinbase and the Commodity Futures Trading Commission (CFTC) testified before Congress on June 6 to debate a draft cryptocurrency bill. The bill aims to establish clear boundaries for when digital currencies should be treated as securities or commodities and when they should not be subject to regulation.

Paul Grewal, Chief Legal Officer at Coinbase, has expressed support for the bill, urging regulators to act swiftly to ensure a clear path for cryptocurrency innovation. CFTC Chairman Rostin Behnam also shared his views on the proposed legislation, which was released on June 2​​.

Furthermore, the commission has also filed a lawsuit against Binance, one of the world’s largest cryptocurrency exchanges. The lawsuit alleges that Changpeng Zhao, the founder of Binance, has control over the company’s U.S. operations, contrary to the company’s public claims.