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SEC takes ‘hostile’ approach to crypto: Robinhood CEO
Robinhood Markets (HOOD) recently received a Wells Notice from the Securities and Exchange Commission (SEC) regarding an alleged violation of registrations as a securities broker-dealer and transfer agent. The trading platform revealed that it had received investigative subpoenas regarding the listing and custody of cryptocurrencies.
Robinhood CEO Vlad Tenev Joins Yahoo Finance Editor-in-Chief Brian Sozzi to discuss the SEC’s concerns regarding Robinhood’s cryptocurrency arm and the state of regulation regarding digital currencies.
Tenev describes the story with the SEC so far: “We have tried to work in good faith with the SEC to register a specialized broker to trade crypto assets. Clearly, this process has not been reciprocal and that is unfortunate. the most compliant and secure crypto platform for customers. As you probably know, we are extremely selective about the coins we offer on the platform. They go through a rigorous vetting process, so it appears the SEC will make a decision. hostile posture towards the crypto industry in general in the United States. »
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This message was written by Nicolas Jacobino
Video transcription
On the commercial front. Um, maybe you could just elaborate a little bit more on that well, notice uh that Robin Hood received uh o on the crypto front an update there and, and how do you plan to defend the company? Well, uh we’ve shared some statements on this. I got a statement about X a few days ago. Um we tried to work in good faith with the sect to register a specialized broker to uh trade crypto assets. Um, obviously, this process, uh, was not reciprocal. And that’s regrettable. We believe we have the most compliant and secure crypto platform for customers who, as you probably know, are extremely selective about the coins we offer on the platform. rigorous control process. So it appears that the SEC is taking a hostile posture towards the crypto industry in general in the United States. And I think with us, we look forward to defending the company, the industry and our customers. .And I believe that in the long term, crypto will be an important asset class for us as consumers, you’ve seen jurisdictions outside of, you know, the European Union, for example, take a much more proactive route where there is more and more regulatory clarity. So, yes, we want to make sure that America is not left behind here. We should be at the forefront of innovation in all new technologies and I think it is our responsibility to lead that and ensure that regulation is increasingly clear. I am confident that conditions in the United States remain favorable for technology and innovation. Do you already think regulators will warm up to crypto? I think they will, I think you’re starting to see it. I mean, it’s, it’s been a little bit slower than we would like. But five years ago, Bitcoin was in an uncertain environment. Now you see regulators moving beyond Bitcoin and starting to investigate other things and try to understand them. I believe in the long term the US will get there and it’s just a matter of accelerating that, but people want it, it’s an asset class that, particularly in a high inflation environment, is attractive. You’ve seen it get adopted and a lot of practical use cases emerge. So I think crypto technology and the assets themselves will continue to be an important part of the economy. Finally, uh Vlad um Robin is sitting on a ton of cash $4.7 billion, no thoughts on, uh, I guess, a potential dividend or are you going to buy back stock with that. Well, in the past we have repurchased shares, we repurchased about 7% of the outstanding in the third quarter of last year from emerging loyalty technologies. We’ve also uh, I’ve enjoyed having the flexibility to do opportunistic M&A and we’ve been very selective about which companies we look at and end up moving forward with. But uh yeah, it’s, it’s, it’s a huge strength for the company to be able to have a fortress balance sheet in, uh, in all environments. Uh, fascinating quarter from, uh, from you guys. We’ll leave it there. Robin Hood, co-founder and CEO of Vlad 10 of, uh, thanks for always taking time for yourself.Finance.We appreciate it.It’s always a pleasure.Thanks, Brian.