Crypto-Backed Agency Sues U.S. SEC, Prompting Criticism toward the Regulator
A complaint has been filed by the DeFi Education Fund (DEF), a cryptocurrency agency focused on supporting educational initiatives in decentralized finance (DeFi), against the United States Securities and Exchange Commission (SEC). The DEF has joined forces with Beba, an American apparel company, to challenge the SEC’s methods of enforcing regulations. Beba argues that the SEC’s claim that its token is an investment contract is false.
The case has been filed in the U.S. District Court for the Western District of Texas. The DEF and Beba are challenging the SEC’s approach of regulating through enforcement. They are urging the court to hold the agency accountable to the Administrative Procedure Act, which requires federal agencies to establish new rules in a transparent manner that allows for public notice and comments.
The court filing also highlights the $BEBA tokens, which the SEC has classified as investment contracts. The DEF and Beba argue that the SEC has unlawfully targeted businesses in the digital asset industry by adopting an unspoken rule that categorizes most digital assets as securities, even those distributed through airdrops for free.
Beba states that the airdropped $BEBA tokens were used as a marketing tool to enhance consumer interaction with their business and increase brand awareness. They believe that ruling the $BEBA tokens as non-investment contracts and clarifying that a free airdrop is not a securities transaction would protect their business.
The DEF and Beba’s complaint raises concerns about the SEC’s actions and calls for a fair and transparent regulatory approach in the digital asset industry.
