Robinhood Markets Inc. is contesting a Wells Notice from the U.S. Securities and Exchange Commission (SEC), which could lead to enforcement action against its cryptocurrency division, Robinhood Crypto (RHC).

The notice hints at possible securities law violations, but Robinhood maintains that its crypto listings do not constitute securities.

The SEC’s Wells Notice received by Robinhood raises issues with RHC’s crypto listings, custody practices, and overall platform operations.

Robinhood, a popular trading app for stocks and cryptocurrencies, could face injunctions, disgorgement, or civil money penalties.

Robinhood has expressed a readiness to engage with the SEC’s investigation and has sought clearer regulatory guidance through previous registration efforts.

“We firmly believe that the assets listed on our platform are not securities and we look forward to engaging with the SEC to make clear just how weak any case against Robinhood Crypto would be on both the facts and the law,” Dan Gallagher, chief legal, compliance and corporate affairs officer, said in a statement on Monday.

The SEC’s focus on Robinhood is part of a broader pattern of regulatory trend, with similar actions by the agency against other crypto entities such as Uniswap and Coinbase.

Robinhood’s crypto division has previously paid a US$30 million fine to the New York Department of Financial Services for violations related to anti-money laundering and consumer protection.