Stacks Soars 9% As SEC Ends Probe On Bitcoin Layer 2 Developer

Stacks (STX) saw a significant surge of nearly 9% following the U.S. Securities and Exchange Commission’s (SEC) landmark decision. Recently, the U.S. SEC decided to conclude a three-year investigation into Hiro Systems, previously known as Blockstack. The SEC had been scrutinizing the blockchain software developer due to $70 million raised in token sales between 2017 and 2019.

Regulator Ends Probe Against Hiro

This news, disclosed in a Friday filing, marks a notable victory for the crypto sector in its ongoing regulatory struggles. The SEC’s division of enforcement issued a letter to Hiro, stating:

“Based on the information we have as of this date, we do not intend to recommend an enforcement action by the Commission against Hiro Systems PBC, formerly known as Blockstack PBC.”

This letter, attached to the latest filing, contained a standard limitation that the notice should not be interpreted as a full absolution. Moreover, it also does not rule out the possibility of future actions based on the investigation.

This development comes on the heels of another significant regulatory relief reported on Thursday. The SEC also concluded its investigation into stablecoin issuer Paxos without recommending enforcement action. Furthermore, these consecutive favorable outcomes for the crypto industry highlight a potential shift in the regulatory scene, providing a much-needed boost to market sentiment.

Hiro Systems is a prominent player in the blockchain ecosystem. It develops tools for creating decentralized applications on Stacks, a Bitcoin layer-2 blockchain. The Stacks project, envisioned by Muneeb Ali, a veteran in the crypto industry, seeks to leverage Bitcoin’s security and network to support smart contracts and decentralized applications.

Also Read: Bitcoin Crash: Mentougou Payout Threatens Further Downturn With 138K BTC At Stake

Stacks Price Surge

The resolution of the SEC probe into Hiro is a significant milestone for the company and the broader Stacks community. It removes a considerable cloud of uncertainty that had been looming over the project for years. With this regulatory hurdle cleared, Hiro can now focus more on innovation and expansion within the blockchain space.

The market’s response to this news was swift and positive, with Stacks (STX) price climbing over 9% in the one-hour frame. Meanwhile, the 24-hour frame also witnessed Stacks extending into the ‘green’, ditching the bearish trend. At press time, STX price soared 4.54% to $1.71 in the 24-hour frame with a market cap of $2.51 billion.

Also Read: 3 Reasons Why a Historic Bitcoin Bull Run is on the Horizon

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Kritika boasts over 2 years of experience in the financial news sector. Currently working as a crypto journalist at Coingape, she has consistently shown a knack for blockchain technology and cryptocurrencies. Kritika combines insightful analysis with a deep understanding of market trends. With a keen interest in technical analysis, she brings a nuanced perspective to her reporting, exploring the intersection of finance, technology, and emerging trends in the crypto space.

The presented content may include the personal opinion of the author and is subject to market condition. Do your market research before investing in cryptocurrencies. The author or the publication does not hold any responsibility for your personal financial loss.