In June of this year, the SEC named SOL, ADA, MATIC, FIL, and other tokens as unregistered securities, leading to a collapse in the entire altcoin market. With SOL breaking through $125 today, could this be the biggest concern for Solana?
Earlier this year, Binance was sued by the U.S. Securities and Exchange Commission (SEC), accusing the platform of violating 13 securities laws. The lawsuit also mentioned SOL, ADA, MATIC, FIL, and other tokens as unregistered securities, causing a collapse in the altcoin market.
At that time, the cryptocurrency market was worried that Coinbase, Kraken, and other U.S. exchanges would have to decide whether to delist these tokens as regulations became stricter. Market makers in the U.S. would also be affected and may have to stop market-making for tokens classified as securities.
When tokens lose liquidity, these altcoins may face further price declines, especially in the face of SEC regulatory uncertainty and potential legal consequences.
The SEC’s actions in June definitely caused panic and turbulence in the cryptocurrency industry. However, there was a significant update in July regarding the legal battle between Ripple and the SEC over whether XRP is a security. U.S. Judge Analisa Torres made a summary judgment, ruling in favor of Ripple and stating that Ripple’s sale of XRP through exchanges did not constitute securities.
This ruling directly weakened the SEC’s claim that almost “all tokens are securities,” and investors began to reassess the potential value and risks of various tokens in the market, rather than categorizing them all as securities.
In November, the SEC filed a lawsuit against the cryptocurrency exchange Kraken, accusing it of operating an unregistered virtual securities exchange, broker-dealer, and clearing agency without registering with the SEC. It also claimed that Kraken mixed customer assets “with its own funds.” It is worth mentioning that the SEC once again mentioned 11 cryptocurrencies, including SOL, ADA, MATIC, as securities. However, the market seems to have gradually become numb to the SEC’s position, and there hasn’t been much turmoil in the market.
Despite the potential selling pressure from FTX and the SEC’s ongoing “cryptocurrency securities argument,” the price of Solana (SOL) has continued to rise by over 470% since mid-October. Whether it can continue to grow under the increasingly clear regulatory pace in the United States remains to be seen.
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