Lejilex and the Crypto Freedom Alliance of Texas, a crypto nonprofit, have teamed up to introduce a complaint against the actions of the SEC towards actors in the digital asset industry in America. The complaint alleges that the SEC has no regulatory powers over these crypto companies, having usurped functions not given to it by Congress.
Lejilex and Crypto Freedom Alliance of Texas Sue SEC for Unlawfully Targeting the Digital Asset Industry
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Lejilex, Crypto Freedom Alliance of Texas Sue SEC for Overreaching in Its Crypto Actions
Lejilex, a Texas-based company that is seeking to launch a non-custodial exchange, and the Crypto Freedom Alliance of Texas (CFAT) have introduced a complaint against the U.S. Securities and Exchange Commission (SEC) for what they allege is an unlawful assertion of regulatory authority over almost all cryptocurrency transactions in Texas and the U.S.
According to the complaint, introduced on Feb. 21 before the U.S. District Court for the Northern District of Texas, the SEC has been involved in a “gross overreach” campaign in its aggressive regulatory actions against multiple companies in the crypto industry.
These actions have been supported by the assumption that almost all digital assets are investment contracts due to an assumed expectation of an increase in their value over time due to the efforts of others. However, according to the complaint, this notion risks including simple collectibles and even luxury goods in this category, a subject discussed before in other crypto legal cases.
Lejilex and CFAT criticize this expansive overreach of the SEC, explaining that it has not been supported by the U.S. Congress, leaving the cryptocurrency industry “subject to the arbitrary enforcement whims of an agency with an overly broad view of its own authority.”
With this action, Lejilex aims to obtain clarity on the procedures it must follow before launching its new cryptocurrency exchange platform, seeking to avoid registering with the SEC as a securities exchange, broker, or clearing agency.
Mike Wawszczak, a co-founder of Lejilex, stated:
We wish we were launching our business instead of filing a lawsuit, but here we are. The SEC’s rogue enforcement actions targeting our industry have paralyzed those of us who just want to build lawful businesses and technologies.
Jake Chervinky, CLO of Variant, a crypto capital firm, explained this action marks the start of a crypto offense in courts. “If you thought the SEC could use litigation to bully this industry out of the USA, think again,” he stressed.
Amanda Tuminelli, CLO at the Defi Education Fund, referred to this complaint as the first time that a crypto company has proactively sued the SEC before launching a project to receive clarification on crypto-related securities questions.
What do you think about the complaint Lejilex and the Crypto Freedom Alliance of Texas introduced against the SEC? Tell us in the comments section below.
