SEC's Latest Ruling: Cardano, Solana, Polygon Tokens Flagged as Securities

November 22, 2023 at 02:30 AM GST 2 mins read News

The SEC deems Cardano, Solana, and Polygon as potential securities in legal clashes with Kraken.
Teams deny the securities classification, awaiting a possible change pending a court ruling.
Speculation looms on SEC actions akin to Ripple’s case, but no formal plans were announced against ADA, SOL, or MATIC issuers.

The recent tussle between the United States Securities and Exchange Commission (SEC) and several cryptocurrencies has thrown Cardano, Solana, and Polygon into the spotlight. In a legal battle involving Kraken, the SEC has raised concerns, labeling these tokens as potential securities.

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Kraken has been charged by the SEC for purportedly violating securities laws by running an unregistered securities exchange, prompting the SEC to list several tokens, including ADA, SOL, and MATIC, among others, as alleged securities.

This move by the SEC mirrors previous mentions of ADA as an unregistered security in lawsuits against major platforms like Coinbase and Binance. Similar allegations against Solana and Polygon have emerged in legal disputes involving these exchanges.

Despite the SEC’s classification, teams behind Cardano, Solana, and Polygon vehemently deny these tokens’ characterization as securities. Input Output Global, leading the Cardano project, staunchly refutes the SEC’s claim, emphasizing that ADA does not fall under US securities laws as a security.

However, this determination ultimately hinges on a potential court ruling that could sway the SEC’s stance. While speculations swirl regarding the SEC’s course of action after the Ripple lawsuit concludes, the regulatory agency has not unveiled any formal plans to charge the ADA, SOL, or MATIC issuers with violating securities laws.

Regardless, the SEC’s classification could have a significant impact on the ADA, SOL, and MATIC prices. The looming legal battles and the potential for legal actions against the issuers might lead to increased caution among investors, possibly resulting in a temporary decrease in demand for these tokens.