Investing.com -- The U.S. Securities and Exchange Commission (SEC) has opted to withdraw its appeal of a federal judge's decision from late last year, which annulled a revision of Treasury dealer rules. This recent development was confirmed in a court document filed on Wednesday.

The SEC made an announcement, explaining its decision to drop the appeal. It stated that the new rule could potentially decrease liquidity in the Treasury markets, leading to increased volatility and a rise in debt for taxpayers.

A year prior, under the leadership of Chair Gary Gensler, the SEC had implemented a rule. This required proprietary traders and other firms that frequently deal in U.S. government bonds to register as broker-dealers. This registration subjected these entities to more rigorous supervision.

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