Texas-based clothing company Beba and crypto lobbying group DeFi Education Fund dropped a 2024 lawsuit against the U.S. Securities and Exchange Commission (SEC) over its approach to airdrops, citing a recent change in the regulator’s approach to cryptocurrencies.
Beba launched a free token airdrop in March 2024 and, together with a DeFi education fund, filed a pre-enforcement complaint against the SEC that same year.
The lawsuit alleged that the regulator adopted a digital asset enforcement policy without a formal notice and comment rulemaking process, in violation of the Administrative Procedure Act.
Voluntary dismissal, filed on Friday in the U.S. District Court for the Western District of Texas, cites the work of the SEC Crypto Task Force and statements by Commissioner Hester Peirce in several speeches last year that suggested airdropped tokens are not securities.
The filing also highlighted Peirce’s suggestion in May that the SEC was considering an exemption framework for discharges, and the White House’s January executive action encouraging the regulator to establish a “safe harbor for certain discharges.”
“Given the good work done by the SEC Crypto Task Force and recent speeches that suggest a change in the Commission’s position on free airdrops, we have decided that it is not necessary to proceed for now and may resubmit the application if the need arises later,” the DeFi Education Fund said in Friday’s X post.
“The DEF team expects that the SEC Crypto Task Force will soon address airdrops, the primary issue at issue in this lawsuit,” he added.
The case has been dismissed without prejudice for now
The waiver was filed without notice, preserving the right of Beba and the DeFi Educational Fund to re-release if necessary.
“If the expected relief is not met or is insufficient, plaintiffs retain the right to refile their claims,” lawyers acting on behalf of the couple wrote in a court document.
The SEC’s Evolving Position on Cryptocurrencies
Under the leadership of former SEC Chairman Gary Gensler, the agency faced hefty criticism from the crypto industry for allegedly shaping policy through enforcement actions and legal settlements rather than formal rulemaking.
Related: The SEC is seeking comment on the OTC broker-dealer’s handling of cryptocurrencies
Since Gensler resigned on January 20, 2025, cryptocurrency advocates have witnessed regulatory changes from the SEC, including the dismissal of several long-standing enforcement actions against crypto companies.
In a recent case, the SEC dropped a two-year lawsuit against Nader Al-Naji, the founder of blockchain-based social media platform BitClout, for allegedly raising over $257 million by selling the platform’s native token BitClout and spending over $7 million on personal items.
Warehouse: The SEC’s turn to cryptocurrencies leaves key questions unanswered