In a landmark lawsuit announced Monday, the U.S. Securities and Exchange Commission (SEC) alleges that several altcoins, including Solana, Polygon, and Cardano, should be considered securities. This claim touches a large number of crypto coins that are prominent in the crypto market today.
SEC Files Lawsuit Against Binance
Among the defendants in the lawsuit is Binance, one of the largest players in the crypto industry. The crypto exchange and its CEO, Changpeng Zhao, are facing a whopping 13 charges ranging from trying to circumvent US securities laws to applying superficial checks to determine who is allowed to do business with the company.
But it doesn’t stop there According to the SEC, Solana, Polygon, Cardano and numerous other altcoins fall under the category of securities. These coins each have significant market caps, some with values running into the billions of dollars. On the other hand, there are also smaller, gaming-focused projects that are on the SEC’s radar.
Among the specific tokens being challenged by the SEC are Binance’s BNB token, the exchange’s stablecoin BUSD, and a dozen other tokens, such as Solana (SOL), Cardano (ADA), Polygon (MATIC), Filecoin ( FIL), Cosmos Hub (ATOM), The Sandbox (SAND ), Decentraland (MANA), Algorand (ALGO), Axie Infinity (AXS) and COTI (COTI).
SEC allegations against Binance and BAM Trading
A main SEC charge against Binance and BAM Trading, the operator of Binance.US, which Binance has said is a separate company, is that the two operated as exchanges without registering with the SEC.
Linked to these allegations, the SEC states that certain cryptocurrencies have been offered and sold as securities on both the international Binance exchange and Binance.US. The SEC writes:
“Both Binance and BAM Trading are accused of unlawfully engaging in the unregistered offers and sales of crypto assets. According to the SEC, these actions concealed critical information from investors, including risks and trends that could affect the company itself, as well as investments in these so-called securities.“