Robinhood Ready to Fight SEC Crypto Accusations, Analysts See Victory Ahead!
In a recent report, KBW brokers made a bold prediction: Robinhood Markets Inc. (NASDAQ: HOOD) is gearing up for a legal showdown with the United States Securities and Exchange Commission (SEC) – and according to KBW, Robinhood is poised to emerge victorious.
The brokerage firm’s analysts emphasized that despite the looming threat, Robinhood intends to maintain its crypto trading services, focusing on a selection of just 15 digital assets.
Robinhood Gears Up for Court Battles
Following a recent Wells notice concerning its crypto operations, the SEC is gearing up to take legal action against Robinhood. According to KBW, this could happen in the coming months. However, Kyle Voigt and his team at KBW point out a crucial detail: Robinhood’s revenue streams aren’t heavily reliant on crypto trading, constituting only a modest 12 percent of its quarterly earnings.
Despite this impending legal battle, Robinhood’s stock, represented by the ticker symbol HOOD, saw minimal fluctuations, maintaining a steady trading price of approximately $17.80 over the last day.
“Our preliminary view is that HOOD would likely fight the SEC in court and has a higher likelihood to prevail than most U.S. competitors (if put in similar situations) given HOOD’s stricter listings standards,”
David vs Goliath Confrontation
KBW’s analysts are optimistic about Robinhood’s prospects in the courtroom. They believe that Robinhood is well-positioned to fight the SEC and has a good chance of winning, thanks to its strict listing standards.
What is Ethereum, Really?
The debate over Ethereum’s classification – security or commodity – has reached fever pitch in the United States. According to the SEC, Ether qualifies as a security due to its active development community, complete with dedicated websites and influential social media figures.
However, Consensys, a major player in the blockchain industry, begs to differ. In a lawsuit filed against the SEC, Consensys argues that Ethereum serves as a global computing platform rather than an investment vehicle.
“The worst case scenario from a revenue-at-risk perspective is if the SEC chooses to move forward with categorizing ether (ETH) as a security – as this likely makes up ~25% of HOOD’s crypto assets/trading,”
Stay tuned to Coinpedia! As the legal battle between Robinhood and the SEC unfolds, we’ll keep you updated on how it might impact your crypto investments.
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