Crypto.com SEC Probe Concludes Without Action, Confirms CEO Kris Marszalek
The prolonged investigation by the United States Securities and Exchange Commission (SEC) into Crypto.com has officially come to a close, with no legal action taken against the prominent cryptocurrency exchange. This announcement was made by the company’s CEO, Kris Marszalek, following a tense seven-month period that began with the SEC serving Crypto.com a Wells notice in August 2023. In a statement released on March 27, Marszalek expressed his gratitude for the decision by the current leadership of the SEC to discontinue its investigation. He criticized the previous SEC administration, led by Gary Gensler, for what he described as a “calculated attempt to put an end to the industry.” Marszalek asserted, “They used every tool available to attempt to stifle us, restricting access to banking, auditors, investors, and beyond.” Nonetheless, he maintained that Crypto.com’s resilience and strength during this challenging period reaffirmed the company’s vision and the support it received from its community.
Nick Lundgren, Crypto.com’s chief legal officer, echoed these sentiments in a statement following the announcement, attributing the SEC’s previous actions to an abuse of power that he claimed negatively impacted the cryptocurrency industry at large.
Notably, this conclusion comes after Crypto.com filed a lawsuit against the SEC in October 2023, only two months after the issuance of the Wells notice. The lawsuit contended that the commission had overstepped its regulatory authority, employing a misguided approach to cryptocurrency regulation.
The SEC’s decision to close the investigation aligns with a broader trend of recent resolutions affecting the crypto space. Over the past five weeks, several other investigations and legal actions against well-known entities, including Coinbase, Consensys, Robinhood, Gemini, Uniswap, and OpenSea, have also been dropped. On the same day as the announcement regarding Crypto.com, the SEC dismissed its civil enforcement action against the crypto trading firm Cumberland DRW.
This shift in policy comes with a new leadership structure at the SEC. Since the appointment of Mark Uyeda as acting chair on January 20, following Gensler’s resignation, the commission has notably softened its approach toward cryptocurrency regulation. Under this new leadership, the SEC has established a Crypto Task Force, chaired by Commissioner Hester Peirce, aimed at fostering a more supportive environment for cryptocurrency businesses. Additionally, the commission recently overturned a controversial rule that required financial firms holding cryptocurrency to treat these assets as liabilities on their balance sheets.
Amid these developments, Crypto.com continues to expand its business operations. On March 24, the platform announced a strategic partnership with Trump Media to introduce a series of “Made in America”-themed exchange-traded funds (ETFs) later this year. In this partnership, Crypto.com will provide the necessary infrastructure and custody services for the crypto tokens included in these funds, which may consist of leading cryptocurrencies such as Bitcoin (BTC), Ether (ETH), Solana (SOL), XRP (XRP), and Cronos (CRO).
As the cryptocurrency landscape evolves, the interactions between innovative platforms like Crypto.com and regulatory bodies such as the SEC remain crucial to the industry’s stability and growth.
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