Richard Heart's Historic Showdown with the SEC: A Turning Point in Crypto Regulation

A bombshell has shaken the crypto community—Richard Heart (founder of HEX and PulseChain) has achieved a complete victory in his lawsuit against the US SEC. The federal court dismissed all charges, citing insufficient evidence to prove illegality or fraud. This is the first case where a Layer 1 blockchain and its founder have successfully fought off US regulatory authorities, marking a major legal breakthrough for decentralized open-source projects.

Why is this lawsuit so critical?

The SEC has long tried to exert regulatory pressure on crypto projects, but this defeat exposes a key issue: for truly decentralized systems, regulators find it difficult to prove fraud allegations. Heart’s victory means other open-source projects now have a legal precedent to push back against regulatory overreach.

What are HEX and PulseChain?

HEX is an ERC-20 token launched on Ethereum in 2019, designed as an “on-chain time deposit”—you lock up tokens and earn rewards based on the duration. This mechanism attracted many long-term holders, but also drew plenty of criticism, with some calling it a “wealth transfer mechanism designed for Heart.”

PulseChain is Heart’s Ethereum fork aimed at solving Ethereum’s pain points:

• Excessive transaction fees (especially HEX’s gas fees on Ethereum)
• Lack of scalability
• Replacing PoW with PoS consensus for better environmental friendliness

Criticism has never stopped

Many have questioned whether these two projects are overly centralized around Heart himself, with insufficient transparency and lackluster market response—eHEX, for example, shrank by over $1 billion after Heart announced the move to PulseChain. Nevertheless, Heart has managed to build a loyal community.

Lessons for the Industry

This case sends a clear signal to the entire crypto industry: decentralized design offers legal protection. Regulators are finding it increasingly challenging to exert control over truly distributed systems. In the future, we may see more projects adopt open-source, decentralized architectures to mitigate regulatory risk.

At the same time, it reminds project teams—transparency remains key to earning trust. Proactively embracing compliance before regulatory changes is much smarter than reacting passively.

In short: This isn’t just Heart’s personal victory; it’s a milestone for the entire open-source crypto ecosystem. What we need to watch next is how regulators will adjust their strategies in response to this setback.