Investing.com – Crypto.com has filed a lawsuit against the U.S. Securities and Exchange Commission (SEC), joining a growing list of cryptocurrency companies opposing the regulator’s approach to crypto assets.
The legal action is in response to what the company describes as exceeding the SEC’s limit on regulating the cryptocurrency industry.
For now, Crypto.com is assuring its customers that operations will continue as usual, challenging the SEC’s position in court.
The move comes after Crypto.com received a Wells Notice from the SEC, which is a warning that enforcement action may be taken. However, receiving such a notification does not automatically mean that the company has engaged in misconduct.
Crypto.com argues that the SEC’s tactics exceed its legal boundaries, despite signals from political leaders that the next administration may take a more favorable stance towards the cryptocurrency sector.
Similar Wells notices have also been issued on NFT marketplace OpenSea, cryptocurrency exchanges Coinbase (NASDAQ:) and Kraken, as well as popular trading app Robinhood (NASDAQ:).
In its lawsuit, Crypto.com claims that the SEC has unlawfully expanded its jurisdiction by designating most crypto assets as securities, excluding core assets such as and . The company claims that this classification was made without due legal process and lacks consistent justification because transactions in many crypto assets resemble those of BTC and ETH.
Separately, Crypto.com has filed a petition with the Commodity Futures Trading Commission (CFTC) and the SEC to clarify which agency has regulatory authority over certain cryptocurrency derivatives. The Singapore-based company says these products fall solely under the jurisdiction of the CFTC, demanding a more definitive regulatory framework for the industry.
That said, the exchange discussed its registration with the Financial Crimes Enforcement Network (FinCEN) and more than 40 state money transmitter licenses in the US. It also indicated that it is a designated contract market and clearing organization for the CFTC.
“We are proud to be a global industry leader in licensing, registration and security certification – maintaining over 100 regulatory approvals to operate in jurisdictions around the world and supporting the design of regulatory frameworks built specifically for today’s digital economy, alongside the best-in-class first-class safety and security certificates,” the exchange added.
According to CCData, in September, the volume of spot and derivatives transactions on the Crypto.com platform increased by over 40% on a monthly basis. This year, the exchange gained the most in spot trading, increasing its market share to 10.5%.
