PANews reported on February 20 that according to Decrypt, the U.S. Securities and Exchange Commission (SEC) voluntarily withdrew its appeal against a ruling that prevented the agency from expanding existing securities laws to cover DeFi users and projects. In a four-page motion filed by the U.S. SEC with the Fifth Circuit Court of Appeals, it expressed the hope to "voluntarily withdraw the appeal," a move that was not opposed.

Last November, a federal judge in Texas ruled that the SEC exceeded the regulator’s authority by expanding the legal definition of “dealer.” The judge believed that the changes to the SEC’s dealer rule were illegal because it lumped DeFi traders with financial brokers.