Anika Begay
Cryptocurrency trading platform Robinhood remains in talks with the U.S. Securities and Exchange Commission (SEC), following a warning letter issued by the financial regulator in May.
In a interview In an interview with Bloomberg Television, CEO Vlad Tenev revealed that the company has filed a response to the SEC’s Wells notice regarding its cryptocurrency operations, hinting at potential regulatory scrutiny.
Robinhood CEO Highlights Solid Response
A Wells Notice is a letter from the SEC informing a company that the regulator is considering recommending civil or administrative action against it.
Robinhood has since sent a response, with Tenev noting that the company “spent a lot of time making sure the response was of the highest quality possible.” Wells’ notice presumably refers to Robinhood cryptocurrency activity as the company navigates the U.S. regulatory and legislative environment.
Tenev highlighted the efforts made to develop a “robust and meticulous” response, underlining the company’s commitment to addressing regulatory requests with “the utmost diligence.”
While refraining from divulging further details, Tenev reiterated the company’s commitment to transparency and compliance standards in navigating the regulatory landscape.
Tenev Sees Healthy Retail Buying
Following a surge in retail trading activity amid the pandemic-induced market frenzy of 2020, Robinhood has diversified its company portfoliodiversifying into sectors such as pension products, credit cards and international crypto ventures.
In contrast, industry competitors such as Charles Schwab Corp. and Fidelity Investments have encountered operational difficulties, including service disruptions during the recent global stock market crisis, according to Bloomberg.
Tenev reassured shareholders of the “resilience” of Robinhood’s technology infrastructure, citing the lack of significant disruptions during recent market downturns. volatility which have affected rival platforms.
“Now, when we see high volumes, we’re ready,” Tenev said. “Customers tend to buy the dip; there are more buyers than sellers, which we think is a good sign for the health of the retail market.”
However, the company has encountered some difficulties with its execution venue, Blue Ocean ATS, which was forced to suspend overnight trading due to its inability to handle the scale of market activity.
Tenev acknowledged that “the infrastructure has essentially collapsed” and said the company is working to ensure Blue Ocean can enable overnight trading for all its clients as soon as possible.
As the cryptocurrency sector recovers from Monday’s market crash, the total cryptocurrency market cap has returned above the $2 trillion mark, after a brief dip towards $1.69.
On the other hand, Bitcoin (BTC) led the rally, edging ever closer to the $60,000 mark, which is crucial for the cryptocurrency’s prospects, after falling to a low of $49,000 on Monday.
Featured image from DALL-E, chart from TradingView.com
