The United States District Court of the Northern District of Texas has ruled that the Securities and Exchange Commission (SEC) exceeded its statutory authority with its dealer rule, which has now been struck down. This decision marks a significant development for the digital asset industry.

Blockchain Association CEO Kristin Smith commented on the ruling: “Today’s court ruling is a victory not just for Blockchain Association and the Crypto Freedom Alliance of Texas – but for the entire digital asset industry. The Dealer Rule was an attempt by the SEC to advance the agency’s anti-crypto crusade, unlawfully redefining the boundaries of its statutory authority granted by Congress. Following today’s ruling, the agency’s overreach is rolled back and the digital asset industry is protected from this unlawful rule.”

Marisa Coppel, Head of Legal at Blockchain Association, emphasized the importance of litigation in defending against regulatory overreach: “Litigation isn’t always the preferred path, but in some cases it’s critical to defending the industry against overzealous regulators, and at those moments we have a responsibility to challenge such actions. The SEC clearly exceeded its authority by adopting a definition of ‘dealer’ that is, in the Court’s words, ‘untethered from the text, history, and structure of the Exchange Act.’”

The legal challenge was initiated by Blockchain Association and Crypto Freedom Alliance of Texas in April. They argued that SEC's actions amounted to arbitrary and capricious rulemaking.

Blockchain Association represents leading investors, companies, and projects within cryptocurrency aiming to promote innovation-friendly policies. Meanwhile, Crypto Freedom Alliance of Texas advocates for responsible digital asset policies in Texas.