The U.S. Securities and Exchange Commission (SEC) has officially closed its years-long investigation into AAVE Protocol, as confirmed by AAVE CEO Stani Kulechov. This development marks AAVE addition to the growing list of cryptocurrency projects and companies no longer under the scrutiny of the U.S. securities regulator, amid significant changes in the regulatory environment for blockchain and DeFi .
In a social media Chia on Tuesday, Stani Kulechov stated that the SEC had “concluded its investigation” after approximately four years of work and discussions with AAVE. According to him, for many years, the decentralized finance (DeFi) sector has faced regulatory pressure that he considers unfair, hindering innovation. The conclusion of the investigation is XEM as a significant turning point, giving AAVE and other DeFi developers more space to build new blockchain-based financial models.
Representatives from AAVE Labs also confirmed that the SEC's conclusion of the investigation allows the company to publicly release the results for the first time. According to AAVE Labs, the review process, which lasted for years and involved regular communication with regulators, has now officially concluded, allowing AAVE Labs to be more transparent with the community and investors about the legal status of its protocol.
On the SEC's side, a spokesperson emphasized that they typically do not comment on whether or not specific investigations exist. However, a photograph of a letter dated August 15th, attached to Kulechov's post, suggests that the SEC does not expect to recommend any enforcement action against AAVE Protocol. The letter also mentions a Wells Notice, a type of notification that SEC staff send to businesses when the agency is considering recommending action, indicating that AAVE was in a sensitive XEM phase before being fully "cleared."
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Not long ago, Ondo Finance also reported that the SEC had closed an investigation that began during the Biden administration. During the previous administration, the SEC adopted a cautious approach to digital assets, suing several large cryptocurrency companies for allegedly failing to register. However, the current landscape has changed significantly, with Donald Trump winning the election in late 2024 and now serving as President of the United States, leading to expectations of a more open policy environment towards blockchain technology and digital assets.
