Crypto.com Sues SEC, Accuses Regulator of Illegally Inventing the Term 'Crypto Asset Security”

Prominent exchange Crypto.com sued the US Securities and Exchange Commission (SEC) on Thursday after receiving a Wells notice, which indicated that the American

Crypto.com, a prominent cryptocurrency exchange, has filed a lawsuit against the US Securities and Exchange Commission (SEC) following a Wells notice indicating the regulator's intent to take legal action against the company.

In a blog post, Crypto.com announced that the SEC had accused the exchange of violating securities laws.

The SEC, under the leadership of Gary Gensler, has taken a strong stance on regulating the cryptocurrency industry, arguing that many digital assets offered by exchanges and other platforms meet the definition of a "security" and thus fall under the agency's jurisdiction.

Over the past two years, the SEC has taken legal action against several crypto firms, including Ripple, Uniswap, and Coinbase, accusing them of selling unregistered securities in the form of digital assets.

In its latest Wells notice, the SEC has alleged that Crypto.com facilitates the sale of several crypto tokens, which the regulator deems to be unregistered securities.

The tokens mentioned in the Wells notice include Binance Coin, Cardano, Solana, Algorand, Dash, Near, Internet Computer, Filecoin, Flow, and Cosmos.

Crypto.com, in its lawsuit, is asking the court to order the SEC and the Commodity Futures Trading Commission (CFTC) to jointly confirm that some cryptocurrencies are overseen by the CFTC, which recently declared that Ethereum and Bitcoin are commodities.

The exchange argues that the tokens mentioned in the Wells notice operate similarly to the two largest cryptocurrencies, and thus are not securities.

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