Robinhood, the popular fintech trading app, announced on Friday, June 9, that it would remove support for three cryptocurrencies from its platform.
Reuters reports that Solana (SOL), Cardano (ADA), and Polygon (MATIC) will no longer be available for trading on Robinhood, effective June 27.
This decision comes after recent Securities and Exchange Commission (SEC) lawsuits against major cryptocurrency exchanges, including Binance and Coinbase.
What We Know About the Delisting
According to a blog post by Robinhood, users will have until the June 27 deadline to continue trading and transferring the affected cryptocurrencies.
After that, any remaining tokens in a user's account will be automatically sold at market value. Robinhood clarified that this delisting does not impact other cryptocurrencies on the platform, and users' existing crypto holdings will remain safe.
SEC Crackdown on Unregistered Securities
Robinhood's decision to remove Solana, Cardano, and Polygon from its platform stems from the SEC's assertion that these tokens qualify as unregistered securities.
The SEC recently filed lawsuits against Binance and Coinbase, two prominent cryptocurrency exchanges, claiming that several tokens listed on their platforms are unregistered securities.
As Robinhood aims to maintain compliance with regulatory standards, it has delisted these specific tokens.
Robinhood's Response to SEC Lawsuits
Bloomberg reported that Dan Gallagher, Chief Legal Compliance Officer at Robinhood, testified before the House Agriculture Committee regarding the SEC's lawsuits against Binance and Coinbase.
Gallagher emphasized that while Robinhood holds a broker-dealer license for securities trading, it may not have the authority to trade assets deemed unregistered securities by the SEC.
Implications for Robinhood Users
Robinhood's decision to delist Solana, Cardano, and Polygon might impact users who actively trade or hold these tokens on the platform.
However, it is worth noting that Robinhood offers a relatively limited selection of cryptocurrencies compared to other exchanges like Coinbase.
Users can currently choose from 18 different tokens on Robinhood, while Coinbase offers hundreds of options. You can learn more about the offerings here.
Despite the delisting, Robinhood aims to maintain a robust and compliant platform for its users.
What's next?
With the SEC's increased scrutiny on classifying tokens as securities, Robinhood will likely reassess its cryptocurrency offerings.
The brokerage firm is actively reviewing the regulator's analysis and will determine the appropriate actions to take in response.
Robinhood has shown a commitment to complying with regulatory standards and ensuring its platform's safety and legal compliance.
What's In The News?
Robinhood's decision to delist Solana, Cardano, and Polygon from its platform reflects its response to the SEC's recent crackdown on cryptocurrency exchanges.
By removing these tokens, Robinhood aims to align with regulatory requirements and maintain a secure trading environment for its users.
The delisting will take effect on June 27, and users have until then to trade or transfer the affected cryptocurrencies.
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