Crypto.com Sues SEC To “Protect The Future Of Crypto In The US” After Receiving A Wells Notice

Updated: 09 October 2024

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Crypto.com has sued the US Securities and Exchange Commission (SEC) and its Chair Gary Gensler after receiving a Wells Notice from the regulator.

“Today, Crypto.com filed suit against the SEC to protect the future of crypto in the US,” said the exchange’s co-founder and CEO Kris Marszalek in an Oct. 8 post on X.

He added that the “unprecedented action” by Crypto.com “is a warranted response to the SEC’s regulation by enforcement regime which has hurt more than 50 million American crypto holders.”

Crypto.com Has Been Under Investigation For Over 2 Years

Crypto.com’s filing revealed that the exchange has been under investigation by the SEC for more than two years. It also comes after the exchange received a Wells Notice from the SEC on Aug. 22. Notices of this type are preliminary warnings stating charges the SEC might bring, and usually lead to enforcement actions.

Marszalek promised to use “all regulatory tools available” to bring an end to the SEC’s onslaught against companies operating in the crypto industry. The exchange hopes the recent filing will provide the industry with more clarity as to how digital assets will be regulated in the US.

And to use all regulatory tools available to bring certainty to the industry through proper rulemaking, https://t.co/pFc4Pz9nFR has also filed a petition with the CFTC and SEC to confirm crypto derivative products categorization.

— Kris | Crypto.com (@kris) October 8, 2024

Crypto.com says the Wells Notice is indicative of the “SEC’s unauthorized and unjust regulation by enforcement campaign.”

Crypto.com Files Petition With SEC And CFTC

Crypto.com has also filed a petition with the CFTC and the SEC requesting that they mutually confirm that certain crypto derivative projects are “solely regulated by the CFTC.”

Under the joint rulemaking in the Dodd-Frank Act, the SEC and CFTC have 120 days to either come up with a joint decision or to reject the request. If the agencies opt to go with the latter option, they will have to provide Crypto.com with the reasons for why they did not approve the exchange’s request.