New York, Wednesday, October 16, 2024-Crypto.com has filed a lawsuit against the US Securities and Exchange Commission (SEC), claiming that the agency is overstepping its authority in regulating cryptocurrency.
The lawsuit, filed on October 8 in a federal court in Tyler, Texas, follows a Wells Notice issued by the SEC, which asserts that certain tokens traded on the platform are classified as securities.
A Wells notice is a formal warning from the SEC, signaling an impending enforcement action. The SEC has not commented on the case.
In its lawsuit, Crypto.com argues that the SEC is unilaterally expanding its jurisdiction beyond its statutory limits. The company also contends that the SEC’s position on crypto assets effectively turns most trades into securities transactions, an interpretation it disputes.
The legal battle highlights the growing tension between the SEC and cryptocurrency companies, many of which claim that the agency’s actions are inappropriate and hinder innovation. Other digital asset firms, including Coinbase, Robinhood’s crypto division, and NFT platform OpenSea, have received similar notices from the SEC.
In addition to the lawsuit, Crypto.com has petitioned both the SEC and the Commodity Futures Trading Commission (CFTC), requesting joint clarification on the regulation of cryptocurrency derivatives.
This case adds to the mounting legal challenges faced by the SEC as it pushes for greater oversight of the cryptocurrency market.
