Robinhood Markets Inc. (NASDAQ:HOOD) revealed it is currently facing an investigation by the U.S. Securities and Exchange Commission (SEC) regarding its cryptocurrency business.

What Happened: According to a regulatory filing released on Monday, the Menlo Park-based brokerage received a subpoena in December 2022 in relation to its cryptocurrency listings and custody.

The SEC's action against Robinhood came amid a wave of regulatory action after cryptocurrency exchange FTX filed for bankruptcy.

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The SEC has been taking a closer look at the cryptocurrency market and its investigation into Robinhood's crypto business is expected to center on whether the company provided adequate disclosures to its customers regarding its trading services.

The company's cryptocurrency business has been under scrutiny for some time.

Why It Matters: Over the past two years, Robinhood had been fined a total of $135 million by regulators.

In 2020, the SEC fined Robinhood $65 million over misleading customers. The following year, the Financial Industry Regulatory Authority (FINRA) fined Robinhood $70 million for both outages and misleading customers.

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