Texas-based apparel company Beba and crypto advocacy group DeFi Education Fund have withdrawn their 2024 lawsuit against the U.S. Securities and Exchange Commission over its treatment of token airdrops, citing a recent shift in the agency’s approach to digital assets.
Beba conducted a free token airdrop in March 2024 and, alongside the DeFi Education Fund, filed a pre-enforcement challenge later that year. The lawsuit argued that the SEC had implemented its digital asset enforcement policy without following the required notice-and-comment rulemaking process, in violation of the Administrative Procedure Act.
A voluntary dismissal filed Friday in the U.S. District Court for the Western District of Texas points to the work of the SEC’s Crypto Task Force and remarks by Commissioner Hester Peirce, who indicated in several speeches that airdropped tokens may not qualify as securities.
The filing also references Peirce’s comments suggesting the SEC is considering an exemption framework for airdrops, as well as a January White House executive action encouraging the creation of a “safe harbor” for certain token distributions.
In a post on X, the DeFi Education Fund said it chose to withdraw the case due to the regulator’s evolving stance, adding that the lawsuit could be refiled if necessary. The group also expressed confidence that the SEC’s Crypto Task Force will soon address the issue of airdrops, which was central to the case.
Case dismissed without prejudice
The lawsuit was dismissed without prejudice, preserving the right of Beba and the DeFi Education Fund to refile their claims if necessary.
“Should the expected guidance fail to materialize or be insufficient, Plaintiffs preserve their right to refile their claims,” their legal representatives stated in the court filing.
SEC’s evolving approach to crypto
Under former SEC Chair Gary Gensler, the U.S. Securities and Exchange Commission faced widespread criticism from the crypto industry for shaping policy through enforcement actions and legal settlements rather than formal rulemaking.
Since Gensler’s resignation on Jan. 20, 2025, industry participants have pointed to signs of a regulatory shift, including the dismissal of several long-running enforcement cases against crypto firms.
In one recent example, the SEC dropped a two-year lawsuit against Nader Al-Naji, the founder of blockchain-based social media platform BitClout. The case had alleged he raised more than $257 million through token sales and used over $7 million for personal expenses.
