SEC Agrees To Drop Lawsuit Against Cumberland DRW

Cumberland DRW, the crypto trading branch of proprietary trading firm DRW, announced on Tuesday that it had reached an agreement with the United States Securities and Exchange Commission (SEC) to formally end the regulator’s lawsuit against it.

Cumberland DRW, SEC End Legal Battle

According to the March 4 announcement, Cumberland DRW revealed that it had signed a joint filing with the SEC set to formally end any litigation against the Chicago-based company.

Today we signed a joint filing to be made with the Securities and Exchange Commission (SEC) dismissing its case against Cumberland DRW. The filing was agreed in principle between Cumberland DRW and SEC staff on February 20 and is currently pending Commission approval. As a firm…

— Cumberland (@CumberlandSays) March 4, 2025

The two parties agreed in principle to the deal on February 20, with the filing currently pending Commission approval.

“As a firm deeply committed to the principles of integrity and transparency, we look forward to continuing our dialogue with the SEC to help shape a future where technological advancements and regulatory clarity go hand in hand, ensuring that the U.S. remains at the forefront of global financial innovation,” the firm said in a statement.

The SEC Shifts Course

The SEC filed its complaint against Cumberland DRW back in October 2024 for allegedly violating U.S. securities law by operating as an unregistered dealer for more than $2 billion worth of crypto.

According to the lawsuit, the federal regulator was seeking disgorgement and civil penalties from the crypto company as a consequence for purportedly selling unregistered digital assets since 2018.

“We are not making any changes to our business operations or the assets in which we provide liquidity as a result of this action by the SEC,” Cumberland DRW said shortly after the litigation’s announcement.

“We are confident in our strong compliance framework and disciplined adherence to all known rules and regulations – even as they have been a moving target (it wasn’t long ago ETH was claimed to be a security),” the organization added.

The SEC garnered flack in recent years for its regulation-by-enforcement approach to the digital asset industry under former Chair Gary Gensler.

However, the federal agency has since dropped several lawsuits against key players in the crypto sector in recent weeks, including Kraken, Coinbase, OpenSea, and more.

The SEC’s decision to rescind the lawsuit against Cumberland DRW symbolizes its continued shift toward digital asset regulation in the U.S.

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