SEC Ends Dragonchain Case as Crypto Task Force Signals New Direction

Highlights:

• The SEC has ended its lawsuit against the blockchain firm after ending other lawsuits recently.
• The case has ended without prejudice after a recent meeting between the two parties.
• The DRGN token rose over 90% after the deal was disclosed to the public.

The U.S. Securities and Exchange Commission has dismissed its lawsuit against blockchain firm Dragonchain. The move ends a long court battle that started in 2022. Dragonchain and the SEC jointly filed yesterday in a Seattle federal court. The stipulation seeks to dismiss the case with prejudice. The agency explained its decision by referring to the efforts of its new Crypto Task Force, which it said played a role in guiding the agency’s updated approach to digital tokens.

🚨 The SEC has officially dropped its case against Dragonchain, citing its new Crypto Task Force and policy shift. Another sign the agency is easing up on enforcement under a more crypto-friendly administration. $DRGN up nearly 95%. pic.twitter.com/qImXhYjavF

— CryptoPotato Official (@Crypto_Potato) April 25, 2025

The SEC originally filed the suit in August 2022 and alleged Dragonchain, its foundation, and the company’s founder, Joseph Roets, of providing for sale unregistered investment contracts. The regulator alleged that the company raised $14 million in a presale token sale in 2017. Moreover, it alleged that the company sold another $2.5 million of DRGN tokens between 2019 and 2022 in an ICO.

The agency claimed the company used these sales to fund business operations and support technical development. The SEC argued that Dragonchain should have registered the DRGN tokens under existing laws because they were promoted as an opportunity for profit.

Policy Shift Follows Trump’s Digital Asset Executive Order

After President Donald Trump returned to office, he signed an executive order in January calling for the United States to take a leading role in digital assets. The SEC later formed its Crypto Task Force to review how it should treat digital tokens. As a part of this effort, the agency put on hold a number of other pending cases, including the one against Dragonchain.

Dragonchain representatives met with members of the Crypto Task Force on March 24 to discuss the role of blockchain. Dragonchain’s team, including founder Joe Roets, explained during this meeting that blockchain should be looked at as core infrastructure for tasks such as identity verification, automation, and adding transparency. They maintained that it should not always be tied to financial investments. The SEC later cited this meeting as its reason for dropping the case.

The SEC’s action is one of multiple changes in how it is handling digital asset cases. The agency has ended several high-profile legal disputes since the start of the year. These include some of the more prominent cases involving Coinbase, Kraken, Ripple, and Gemini. The SEC also investigated other firms such as OpenSea, Crypto.com, and Immutable, but no further action was taken. The agency is taking a new approach of deciding which digital tokens should be under its oversight and which should not.

Market Responds to Dismissal with Sharp DRGN Surge

Dragonchain’s token, DRGN, had surged after the news. The news sparked a jump in price of over 90%. At press time, DRGN is trading at $0.07560, a 90.58% increase in the past day. In addition, the trading volume has surged 6342.22% to $448.6K. Before this, DRGN had been in decline since 2021. The lawsuit and the broader legal uncertainty around digital tokens had contributed to the token’s fall. However, the decision to drop the case brought renewed attention to the project.