The Digital Chamber, a cryptocurrency trade association, criticized the SEC for issuing a Wells notice to Robinhood Crypto. In a statement released on May 6, the association expressed deep disappointment and alarm regarding the action, labeling it as an instance of regulatory overreach.

Emphasizing its consistent opposition to the SEC's expansion of authority without congressional authorization, the Digital Chamber highlighted that Congress is actively deliberating legislation to clarify regulatory jurisdiction over cryptocurrencies. It asserted that the SEC's actions have circumvented this legislative process.

To tackle jurisdictional concerns, the Digital Chamber called for immediate legislative intervention and demanded that SEC Chair Gary Gensler testify before Congress.

In a show of support for affected companies like Robinhood, the Digital Chamber commended Robinhood's purported efforts to comply with regulations in good faith and its attempts to register with the SEC.

While the association did not explicitly mention plans to submit an amicus brief in defense of Robinhood, it referenced previous instances where it had done so, notably in Kraken's case in February.

Additionally, the Digital Chamber argued that the SEC's aggressive enforcement actions contradict its mandate to protect investors, suggesting that such tactics hinder new companies and diminish investors' ability to make independent financial decisions.

Robinhood Crypto, as disclosed in a May 4 SEC filing, received a Wells notice indicating the SEC's intent to recommend enforcement action. In response, Robinhood outlined its plans to engage with the SEC to challenge the strength of any potential case based on facts and legal grounds. It reiterated its stance that the assets it deals with are not securities and affirmed its commitment to continuing its crypto-related services.