Robinhood received an SEC subpoena shortly after FTX collapsed
Vlad Tenev, CEO and co-founder of Robinhood, during an interview at the company’s headquarters. David Paul Morris—Bloomberg/Getty Images
Robinhood, a popular mobile stock trading platform that also allows users to buy and sell cryptocurrency, received an investigative subpoena from the US Securities and Exchange Commission (SEC) in December 2022 regarding its cryptocurrency operations.
The subpoena requested information about Robinhood’s “backed cryptocurrencies, custody of cryptocurrencies and platform operations,” according to the company’s 2022 annual report, which was filed Monday.
The mention in the annual report was brief and did not specify why the subpoena was issued or what information the SEC was looking for.
A spokesperson for Robinhood declined to comment when contacted by Fortune. An SEC spokesperson told Fortune that it “does not comment on the existence or non-existence of a possible investigation.”
The lawsuit, which came shortly after cryptocurrency exchange FTX filed for bankruptcy in November 2022, comes as Robinhood struggles to reinvent its crypto business. The company reported continued declines in its crypto trading revenue in the fourth quarter of 2022 and has been trying to get rid of Sam Bankman-Fried, the disgraced founder of FTX, after the board approved plans to buy back more than $550 million worth of the shares Bankman-Fried held purchased earlier in 2022.
The SEC’s subpoena comes amid a broader push by the agency to investigate, and in many cases punish, crypto and crypto-related companies.
In January, the SEC accused both Gemini, a cryptocurrency exchange founded by the Winklevoss twins, and Genesis, owned by well-known cryptocurrency investor Barry Silbert, of unregistered offers and sales of securities through the companies’ joint return-bearing product: Gemini Earnings.
In February, the government arm responsible for overseeing the securities market reached a $30 million settlement with Kraken, one of the largest cryptocurrency exchanges, after it claimed the exchange’s betting feature was a securities offering.
And most recently, the SEC reportedly told Paxos, a stablecoin issuer, that it intended to sue the company over its work on BUSD, a stablecoin pegged to the US dollar that was issued in partnership with Binance, the world’s largest cryptocurrency exchange by trading volume. Paxos is reportedly in talks with the SEC regarding the lawsuit threat.
