Skip to main content


July 8, 2024

Court Must Uphold SEC Dealer Rule that Will Protect Investors from Crypto Risks and Predatory Trading

WASHINGTON, D.C. Stephen Hall, Legal Director & Securities Specialist, issued the following statement on the filing of a friend of the court brief in Crypto Freedom Alliance of Texas v. SEC, No. 4:24-cv-00361-O (N.D. Tex.), defending the SEC’s new rule that requires more firms to register as dealers:

“The securities markets have seen an explosion in crypto currency offerings that have ripped off millions of investors.  We’ve also witnessed a huge increase in firms whose business model is to use lightning-fast trading systems to gain unfair advantages over everyday investors.  In February, the SEC adopted a rule that would address these threats by requiring more firms that trade heavily in the markets as part of their regular business to register with the SEC.  Predictably, advocates for the crypto industry marched into federal court in Texas in hopes of nullifying the rule.  But as we show in our brief, their arguments against the rule have no basis and should be rejected by the court.

“Contrary to the plaintiffs’ claims, this ‘dealer definition’ rule is necessary to strengthen protections for investors, reduce the risk of major market meltdowns, and give the SEC the tools it needs to closely monitor these market participants and head off problems, especially as to crypto and high-frequency trading practices.  It’s obvious that there’s an urgent need for increased accountability and oversight in the crypto markets, since they represent an essentially lawless sector dominated by fraud, manipulation, and theft.

“Moreover, contrary to the plaintiffs’ claims, the rule won’t stifle valuable innovation.  That’s never been a defense to securities regulation, and more to the point, the crypto markets haven’t generated any truly valuable innovations in finance.  Rather, crypto is the preferred tool of criminal networks engaged in ransomware, terrorism, and tax evasion.  Finally, as the SEC explained in the rule, there is nothing in the way crypto markets operate with their new technologies that makes registration under the dealer rule unworkable or overly burdensome.  The court must see through the plaintiffs’ attempt to carve out an exemption from what are vitally important safeguards that will better protect investors and the markets.”

You can read the brief here.


Better Markets is a non-profit, non-partisan, and independent organization founded to promote the public interest in the financial markets, support the financial reform of Wall Street and make our financial system work for all Americans again. Better Markets works with allies—including many in finance—to promote pro-market, pro-business and pro-growth policies that help build a stronger, safer financial system that protects and promotes Americans’ jobs, savings, retirements and more. To learn more, visit

Press Releases


For media inquiries, please contact us at or 202-618-6433.

Contact Us

For media inquiries, please contact or 202-618-6433.

To sign up for our email newsletter, please visit this page.

This field is for validation purposes and should be left unchanged.

Sign Up — Stay Informed With Our Monthly Newsletter

"* (Required)" indicates required fields

This field is for validation purposes and should be left unchanged.

For media inquiries,

please contact or 202-618-6433.


Help us fight for the public interest in our financial markets, protecting Main Street from Wall Street and avoiding another costly financial collapse and economic crisis, by making a donation today.

Donate Today