The U.S. Securities and Exchange Commission (SEC) has formally closed its investigation of Crypto.com with no enforcement action. This marks a turning point for Crypto.com and signals shifting regulations under the leadership of new SEC management. The breakthrough comes after an October 2024 Wells Notice that threatened sanctions with legal action but has generated excitement across the cryptosphere in relief at avoidance.
A Victory for Crypto.com: No Enforcing Action was Taken
Crypto.com, a reputable cryptocurrency exchange, was interrogated by the SEC following a Wells Notice in October 2024. A Wells Notice typically means that the SEC will attempt to bring enforcement action, typically charging securities law violations. The investigation there would have concerned whether or not certain listed crypto assets on the exchange were securities—a subject of ongoing disagreement between the SEC and crypto firms. But the SEC action to shut the investigation without punishing Crypto.com and its indigenous currency, Cronos (CRO), is an enormous relief. This outcome is of huge significance for Crypto.com, which has been a significant player in the industry, offering services ranging from trading to DeFi and GameFi use cases via its Cronos blockchain.
Cronos (CRO) is the native token of the Cronos Chain, a sidechain compatible with the Ethereum Virtual Machine (EVM) for DeFi and metaverse applications. Built on Ethermint, Cronos enables fast porting of decentralized applications (dApps) and smart contracts from Ethereum and other EVM chains to faster, cheaper, and more energy-efficient transactions. In November 2021, Crypto.com destroyed 70 billion of CRO tokens, reducing the supply to capped 30 billion, in hopes of increasing scarcity and value to holders. Regulatory approval of such can revitalize confidence in CRO as well as the larger ecosystem Crypto.com is building.
The SEC’s abandonment of its investigation of Crypto.com is not an unusual development but rather an extension of the agency’s evolving stance toward the cryptocurrency industry. Under his leadership as head of the regulator, former SEC Chair Gary Gensler took an aggressive stance, levying dozens of enforcement actions against cryptocurrency firms. Gensler repeatedly described the crypto space as “rife with abuse,” arguing that many of the digital tokens were securities under existing law and must be registered and disclosed. This perspective led to high-profile enforcement actions against exchanges like Coinbase, which in 2023 was charged with operating an unregistered securities exchange and failing to properly register its staking program.
But the regulatory landscape began to change with the change of guard in President Donald Trump, who has been more crypto-friendly. Trump embraced the industry in his 2024 presidential campaign, attending the Bitcoin Conference and being financially supported by crypto leaders. His administration’s hand can be seen in the SEC’s recent actions. In February 2025, Coinbase announced that the SEC had agreed to drop its enforcement case against the exchange, pending approval by the agency’s commissioners. Similarly, on March 3, 2025, the SEC closed its investigation into Yuga Labs, confirming that Bored Ape Yacht Club (BAYC) NFTs and ApeCoin are not securities.
The nomination of Paul Atkins as SEC Chair also suggests a potential relaxation of regulatory pressure. Atkins will adopt a more cooperative approach, with investor protections as well as facilitating innovation in the digital asset markets. As per a report by CNBC, Atkins’ SEC will emphasize cooperation with cooperative industry participants, deviating from the enforcement-based policy of Gensler. This step is in sync with the SEC’s clearly stated mission to introduce investor protection into crypto markets with a guarantee of stability and transparency, as underscored by an Investopedia breakdown of SEC rules.
Implications for the Crypto Industry
The SEC’s closing of its investigation into Crypto.com has important implications for the crypto industry overall. First, it argues that not all that’s on the blockchain is a security—a significant source of regulatory tension. That the SEC is dropping charges against Crypto.com, Coinbase, and Yuga Labs is a sign that the agency is rethinking how it defines securities in the world of crypto, potentially paving the way for more clear guidance.
That being said, there are still issues. The SEC enforcement action, though less aggressive, still aims to protect investors from fraud and market manipulation, as Investopedia’s review of the agency’s case indicates. Stablecoins and other tokens continue to be subject to regulatory oversight, with the industry working to navigate the complex regulatory framework to achieve widespread acceptance. The SEC’s willingness to work with cooperative companies, underscored in recent settlements, means that compliance and dialogue will be the top priority for crypto companies going forward.
A Step Toward Regulatory Clarity
The SEC’s closing of its investigation into Crypto.com without taking enforcement action is a huge victory for the exchange and the broader crypto industry. It is happening at a moment when there is shifting regulation under fresh management at the SEC, one more even-handed in its approach to protecting investors and facilitating innovation. For Crypto.com, the clearance removes one of the major hurdles, allowing the platform to focus on building out its ecosystem, such as the Cronos Chain, which continues to fuel DeFi and metaverse applications.
As the crypto space continues to change, the recent actions of the SEC—dismissal of charges against Crypto.com, Coinbase, and Yuga Labs—are a potential turning point. While regulatory troubles persist, the trend towards cooperation and openness is good news for a more secure and innovative digital asset future. Meanwhile, Crypto.com and its fans are celebrating a hard-fought win, with the broader industry eagerly waiting for the next turn of events.
