The Securities and Exchange Commission is gearing up to sue Robinhood’s crypto unit.
Transcript:
CONWAY GITTENS: I’m Conway Gittens reporting from the New York Stock Exchange. Here’s what we’re watching on TheStreet today.
Wall Street built on momentum – Monday – following the stock market’s first back-to-back weekly gain since March. Investors are hoping a cool-down in hiring could prompt the Federal Reserve to cut interest rates as early as September. The Dow rallied for a fourth straight session. Meanwhile, the S&P 500 gained one percent and the Nasdaq was also up one percent.
Investors are gearing up for earnings out of Walt Disney on Tuesday. Of key interest for Wall Street: new subscriber numbers for Disney’s streaming service – Disney+.In other business headlines, Robinhood’s crypto division is in trouble with the Securities and Exchange Commission.
The company says it has received a warning from the SEC of an enforcement action, known on Wall Street as a “Wells Notice.” The focus of the notice: crypto tokens traded on Robinhood.
The SEC has taken a hard-line against crypto companies, claiming most digital tokens should be regulated as securities, and thus subjected to SEC registration rules. The crypto industry, however, begs to differ and accuses the SEC of being too aggressive.
Robinhood’s Chief Legal Compliance and Corporate Affairs Officer Dan Gallagher said in a statement: “We firmly believe that the assets listed on our platform are not securities and we look forward to engaging with the SEC to make clear just how weak any case against Robinhood Crypto would be.”
Even though the SEC sent Robinhood the warning, that doesn’t automatically mean the company knowingly did anything wrong.
That’ll do it for your daily briefing. From the New York Stock Exchange, I’m Conway Gittens with TheStreet.
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