The warpath from the American Securities and Exchange Commission (SEC) has been taken to a higher level this week. As the regulator takes both Binance and Coinbase to court, criticism within crypto mounts community with regard to SEC policy. In addition, the SEC has 61 crypto coins as securities, or securities, designated under US financial law. Cardano (ADA) is part of this list and the Cardano Foundation has since responded to the accusation.
Is ADA an effect?
The Cardano Foundation is the organization that oversees the development of the popular layer-1 blockchain. To be precise, the CEO of this organization, Frederik Gregaard, has the discord of the Cardano Foundation knowable made:
The Cardano Foundation disagrees with the recent classification of ADA as a security under US law. We look forward to continuing to work with regulators and policymakers to achieve legal clarity and certainty on these matters.”
The term ‘effect’ has come up frequently in the crypto news, but perhaps not everyone is completely familiar with the term. The term comes from financial laws and regulations and means that there is a financial instrument with a certain profit expectation.
For example, the lingering and well-known lawsuit between Ripple and the SEC relates to the issue of whether XRP can be categorized as a security. Now, however, the financial watchdog is targeting many more cryptocurrencies, which can have major consequences for the market. Securities may not be sold without the proper permits.
In addition to cardano, other cryptocurrencies such as solana (SOL), build ‘n build (BNB), Binance USD (BUSD), polygon (MATIC), the sandbox (SAND), decentraland (MANA), axie infinity (AXS) and coti (COTI ) also designated as a security by the SEC.
Cardano founder reacts optimistically
You could also read recently that Charles Hoskinson, the founder of Cardano, had responded to Binance’s complaint. He said the indictment is a “political and philosophical assault on the existence of crypto and what it stands for.” Despite the indictment, he remains optimistic about the future of the crypto industry.
The fact that the SEC is now going after many different cryptocurrencies to label them as securities is the perfect time for the industry to band together and come together, according to Hoskinson.