Who is afraid of the SEC? Not Robinhood investors

Last June, when the US Securities and Exchange Commission unveiled lawsuits against crypto exchanges Binance and Coinbase, the market reaction was swift and brutal. Investors pulled nearly $800mn in assets from Binance in a day while Coinbase lost more than a fifth of its market value in the week after the news was made public.

Fast forward 11 months and the SEC’s crackdown on the crypto industry continues apace. Robinhood is its latest target. The retail brokerage said in a filing last week that the SEC had sent its crypto unit a so-called Wells notice. That is essentially a warning that it was preparing to take legal action. Companies that receive Wells notices are allowed to respond and argue why they did not break the law.

Yet this time around, investors have shrugged off the news. Shares in Robinhood barely budged on the day. The absence of a market spasm is telling.

Source: Who is afraid of the SEC? Not Robinhood investors