Crypto.Com Takes On SEC In Legal Battle After Receiving Wells Notice
By Benzinga
Crypto.com announced that it has initiated legal proceedings against the SEC, following the receipt of a Wells notice from the regulatory body.
What Happened: The provider of crypto financial services received a Wells notice from the SEC, indicating that the regulatory body was considering enforcement action.
The company contends that the SEC has exceeded its jurisdiction, imposing unauthorized and unfair regulations that are adversely affecting the operations of legitimate, licensed crypto businesses in the U.S.
The lawsuit accuses the SEC of establishing an illegal rule that classifies almost all crypto asset trades as securities transactions, irrespective of their nature. This, according to Crypto.com, contradicts the treatment of similar transactions in Bitcoin (CRYPTO: BTC) and Ethereum (CRYPTO: ETH).
Alongside the lawsuit, Crypto.com submitted a petition to the Commodity Futures Trading Commission (CFTC) and the SEC, seeking confirmation that certain cryptocurrency derivative products fall solely under the CFTC’s regulation.
Also Read: Gary Gensler-Led SEC Scores A Win Over Crypto Firm Accused Of Securities Law Violation
Why It Matters: This lawsuit comes at a critical juncture for the crypto industry, as regulatory scrutiny intensifies. The SEC’s approach to crypto assets has been a point of contention, with many in the industry arguing that the regulatory body’s actions are stifling innovation.
The agency finds itself in lawsuits against Coinbase (NASDAQ:COIN), Kraken and Binance. Its enforcement action have been widely criticized, by billionaire entrepreneur Mark Cuban and former White House Communications Director Anthony Scaramucci among others.
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