The US Securities and Exchange Commission (SEC) continues to direct its focus on digital assets, warning Robinhood Markets of potential enforcement action over its cryptocurrency business through a Wells notice.

Hong Kong's highly-anticipated spot Bitcoin exchange-traded funds (ETFs) have fallen short of expectations in their debut week, attracting a fraction of the assets and trading volumes compared to their U.S. counterparts.

Political action committees with ties to the cryptocurrency industry have amassed over $102 million to support candidates who favor digital assets in the upcoming U.S. congressional elections.

Top stories in the Crypto Roundup today:

• Robinhood Crypto Receives Wells Notice from SEC
• Hong Kong's Spot Bitcoin ETFs Fall Short in Debut Week
• Crypto-Backed Political Groups Contribute Over $102M for Crypto-Friendly Candidates

Robinhood Crypto Receives Wells Notice from SEC

The US Securities and Exchange Commission (SEC) continues to direct its focus on digital assets, warning Robinhood Markets of potential enforcement action over its cryptocurrency business through a Wells notice.

Robinhood, known for its commission-free stock trading, disclosed on Monday that the SEC's staff had issued the Wells notice, which is used by the SEC to inform entities of possible enforcement action, and the company can respond to the SEC’s allegations before any enforcement action is taken.

These responses can sometimes convince the SEC to back down, however,if Robinhood's response is unsuccessful, the SEC could pursue a lawsuit or settle with the company to resolve the investigation.

Robinhood's chief legal officer, Dan Gallagher, expressed disappointment with the SEC's move, stating the company believes that "the assets listed on our platform are not securities."

Under Chair Gary Gensler, the SEC has taken a firm stance, arguing that most crypto tokens fall under the agency's regulatory purview and that platforms facilitating their trade should register with the SEC. This stance has led to enforcement actions against other prominent cryptocurrency exchanges including Coinbase, Kraken, and Binance.

Robinhood had previously revealed that it received an investigative subpoena regarding its cryptocurrency dealings. While the company has discontinued trading of certain tokens in response to SEC actions against other exchanges, its website still offers over a dozen cryptocurrencies, including Bitcoin, Ether, Litecoin, Aave, and Chainlink.

Hong Kong's Spot Bitcoin ETFs Fall Short in Debut Week

Hong Kong's highly-anticipated spot Bitcoin exchange-traded funds (ETFs) have fallen short of expectations in their debut week, attracting a fraction of the assets and trading volumes compared to their U.S. counterparts.

Data from Farside Investors shows the three spot Bitcoin ETFs that launched on April 30 have amassed a total of $262 million in assets under management (AUM, with the vast majority of this sum coming from pre-listing subscriptions, with a meagre $14 million in new inflows during the first week.

This pales in comparison to the billions of dollars that flooded into U.S. spot Bitcoin ETFs upon their launch in January.

Hong Kong's spot Ether ETFs, the first of their kind globally, have also seen a muted response, holding a cumulative $54.2 million in AUM with only $9.3 million in total inflows as of May 6. While these ETFs offer advantages like denomination in three fiat currencies and in-kind transfers allowing investors to redeem units in Bitcoin or Ether, they haven't captured investor’s attention.

Senior Bloomberg ETF analyst Eric Balchunas offered a perspective on the numbers, noting the numbers seen in the US shouldn’t be expected in Hong Kong, and added that the $310 million in Hong Kong are “equal to $50b in the US market.”

Hong Kong's equities sector, with a total market cap of $4.5 trillion, is dwarfed by the $50 trillion behemoth of U.S. listed equities while also being more illiquid.

Crypto-Backed Political Groups Contribute Over $102M for Crypto-Friendly Candidates

Political action committees with ties to the cryptocurrency industry have amassed over $102 million to support candidates who favor digital assets in the upcoming U.S. congressional elections.

According to a Public Citizen report, this fundraising places the cryptocurrency sector among the top three most significant contributors this election cycle, surpassed by only two other super political action committees (PACs.)

The substantial contributions from crypto-backed super PACs reflect the industry's strategic efforts to shape policies amidst growing regulatory scrutiny from bodies like the Securities and Exchange Commission and various lawmakers.

Notably, roughly $54 million of this funding stems from direct corporate expenditures, with significant contributions from Coinbase and Ripple Labs. Venture capitalists and executives from the crypto industry also play a significant role in the financial effort.

These PACs are focusing particularly on pivotal U.S. Senate races in Ohio and Montana this November, where incumbents Sherrod Brown and Jon Tester, both Democrats and members of the Senate Banking Committee, are running for re-election.

Both senators have expressed concerns about the use of cryptocurrencies in illicit activities, pointing to entities such as Hamas and North Korea's Lazarus Group that have exploited these digital assets.

State of the Crypto by Top Tier Exchange Volume

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