Robinhood Escapes SEC Crypto Probe: "Never Should Have Been Opened"

The U.S. Securities and Exchange Commission (SEC) has concluded its investigation into Robinhood Crypto, the cryptocurrency arm of the popular online brokerage platform. The SEC's Enforcement Division informed Robinhood on February 21 that it would not recommend any enforcement action against the platform, marking the end of a year-long probe.

Robinhood disclosed the closure of the investigation in a February 24 announcement. Dan Gallagher, Robinhood Markets' compliance and corporate affairs officer, stated that the investigation "never should have been opened" and that the platform has always respected federal securities laws, never allowing transactions in securities.

The SEC's investigation into Robinhood's cryptocurrency operations began in May 2024, when the regulator issued a Wells notice, indicating a preliminary determination to recommend enforcement actions tied to alleged securities violations. In January 2025, Robinhood reached a $45-million settlement with the SEC over accusations that it violated more than 10 securities laws.

In the wake of the SEC investigation's closure, Robinhood has called on the regulator to abandon its "regulation by enforcement" approach and provide the industry with clearer guidelines for digital assets. This sentiment is widely shared among market participants.