- The SEC has ended an investigation into Stacks, a Bitcoin scaling network, and its original developer Hiro Systems, recommending no enforcement action.
- The investigation was opened in 2021 despite Stacks’ contributors claiming that its token sale had been SEC-qualified.
- Hiro Systems hailed the SEC’s decision, stating it reaffirms their commitment to regulatory compliance and supporting developers building on Bitcoin.
The US Securities and Exchange Commission (SEC) has ended an investigation into Stacks, a Bitcoin scaling network, and its original developer Hiro Systems. This is a positive development for Stacks as it will no longer face the threat of enforcement action from the SEC.
Details of the SEC Investigation
The SEC opened the investigation in 2021 into Stacks, previously known as Blockstack, and its token sale despite claims from network contributors that the sale was SEC-qualified. On July 9, 2024, Hiro Systems was informed that the SEC staff concluded the investigation and did not intend to recommend enforcement action against the company. Hiro Systems announced this outcome in a blog post, stating that it reaffirms their commitment to regulatory compliance.
The SEC’s Decision
This conclusion mirrors a similar one from stablecoin issuer Paxos last week. Paxos revealed that the SEC ended an investigation into its BUSD stablecoin without recommending enforcement action. The SEC’s decisions to close these two crypto-related investigations without further action is a positive sign for the industry.
Conclusion
The SEC ending its investigation into Stacks allows the network to move forward without the regulatory uncertainty it previously faced. This outcome validates Stacks’ efforts to comply with regulations and represents a step forward for crypto networks looking to operate legally in the US. While crypto regulation remains a complex issue, the SEC’s conclusion sends a promising signal to crypto developers and investors alike.
