SEC Closes Investigation into Crypto.com, Firm’s CEO Confirms
March 28, 2023 – The United States Securities and Exchange Commission (SEC) has officially concluded its investigation into Crypto.com, the popular cryptocurrency exchange. This announcement was made by the company’s CEO, Kris Marszalek, indicating that no enforcement action will be taken against the firm.
In a post on the social media platform X, Marszalek expressed relief and satisfaction with the SEC’s decision. "They used every tool available to attempt to stifle us, restricting access to banking, auditors, investors, and beyond," he wrote. "It was a calculated attempt to put an end to the industry." He emphasized that Crypto.com’s resilience and growth during this challenging period reflect the strength of their vision and community support, stating, "Onwards!"
The conclusion of the SEC’s investigation comes seven months after it issued a Wells notice to Crypto.com in August 2022. This notice indicated the SEC’s intention to take legal action against the exchange unless certain matters were addressed. Following the Wells notice, Crypto.com took proactive measures by filing a lawsuit against the SEC in October 2022. In this litigation, the firm contended that the SEC, under the leadership of former chair Gary Gensler, had overstepped its authority and adopted a misguided approach toward cryptocurrency regulation.
Nick Lundgren, Crypto.com’s chief legal officer, also praised the closure of the investigation, stating, "We are pleased that the current SEC leadership has made the decision to close its investigation into Crypto.com." Lundgren remarked that the previous administration had abused its authority in a way that negatively impacted the broader cryptocurrency industry.
Changing Landscape at the SEC
The closure of Crypto.com’s investigation is part of a broader trend of the SEC rolling back several other investigations and lawsuits within the cryptocurrency space. Over the past five weeks, the SEC has dismissed inquiries against several crypto firms, including notable companies such as Coinbase, Consensys, Robinhood, Gemini, Uniswap, OpenSea, and more recently, Immutable. Moreover, the SEC dismissed its civil enforcement action against the crypto trading firm Cumberland DRW with prejudice on March 27. Since the appointment of Mark Uyeda, who began serving as acting chair of the SEC on January 20, 2023, the agency has adopted a markedly friendlier approach toward the cryptocurrency sector. Uyeda has implemented essential changes, including establishing a Crypto Task Force led by SEC Commissioner Hester Peirce to foster a more constructive regulatory environment. Additionally, the SEC canceled a controversial rule that required financial firms to categorize crypto holdings as liabilities on their balance sheets.
Future Ventures for Crypto.com
As the regulatory landscape evolves, Crypto.com is looking forward to new opportunities. On March 24, the exchange announced a partnership with Trump Media to launch a series of "Made in America"-themed exchange-traded funds (ETFs) later this year. Through this partnership, Crypto.com will provide the necessary infrastructure and custody services to support these ETFs, which may include a diverse basket of cryptocurrency tokens such as Bitcoin (BTC), Ether (ETH), Solana (SOL), XRP (XRP), and Cronos (CRO).
The developments at Crypto.com and within the SEC are indicative of a significant shift in the regulatory environment for cryptocurrencies in the United States. As the industry adapts to these changes, stakeholders will be watching closely to see how this new regulatory framework unfolds.
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