The DeFi Education Fund, a prominent lobbying group, and Beba, a Texas-based apparel company, have dropped a lawsuit against the US Securities and Exchange Commission.
Summary
- DeFi Education Fund and Beba withdraw their 2024 lawsuit against the SEC as regulatory signals on airdrops begin to soften.
- SEC’s evolving stance under new leadership includes potential exemptions for airdrops and a move away from enforcement-led policymaking.
The lawsuit was filed back in 2024 as a pre-enforcement challenge, where the plaintiffs argued the SEC had adopted its digital asset enforcement policy without going through a formal notice-and-comment rulemaking process.
However, under new leadership, the commission has since taken a more accommodating stance toward the crypto sector, which has led to the voluntary dismissal filed on Friday. The filing was made without prejudice, which means the plaintiffs can refile the case at a later stage if needed.
Over the past year, regulatory signals have started to evolve, including remarks from Commissioner Hester Peirce, who has indicated that airdrops may not fall under securities laws. Meanwhile, the filing also noted that the SEC is exploring a potential exemption framework for airdrops.
“Given the good work done by the SEC Crypto Task Force and recent speeches that suggest a change in the Commission’s position regarding free airdrops, we decided continuing was unnecessary for the time being and we can re-file if we need to later on,” the DeFi Education Fund wrote in an X post.
It added that the SEC Crypto Task Force is expected to address airdrops soon, which remains the central issue behind the original lawsuit.
Under Gary Gensler, the commission was heavily criticized for its enforcement-first approach. During his time, Gensler presided over dozens of enforcement cases against major digital asset exchanges and DeFi protocols instead of focusing on rulemaking and clear regulatory guidance.
Now, with a pro-crypto leadership at the helm, the SEC has leaned into crypto legislation and has prioritized collaborative dialogue with industry participants.
The SEC has also dismissed or settled outstanding cases against several prominent blockchain firms and their executives.
