Cardano (ADA) is now almost 25 percent in the red amid the regulatory uncertainties currently playing out in the crypto landscape. The American Securities and Exchange Commission (SEC) claims that ADA is an effect, either securitybut the organizations behind the popular smart contract network firmly believe that the securities markets regulator is wrong.
For example, it recently appeared in the Cardano news that the Cardano Foundation, the organization that oversees the development of the Cardano blockchain, had made it clear that it disagrees with the qualification of ADA as a security under US law. Now the developers behind Cardano have also expressed their opinion.
Cardano developers respond
Input Output Global (IOG), the developers behind Cardano, stated in a statement a few days ago how they view the recent accusations from the SEC. It began by stating that the SEC’s charges contain numerous factual inaccuracies and will not affect the company’s business in any way.
In addition, IOG stated quite adamantly that their view is diametrically opposed to the SEC’s regarding the qualification of cardano under securities law:
ADA is in no way a security under U.S. securities laws. It never was. Understanding how decentralized blockchains work is a fundamental part of creating responsible legislation.”
Opinion SEC is not a law
IOG also expresses its criticism of the SEC’s policy in the statement:
“Regulation through enforcement provides neither the clarity nor the certainty that both the blockchain industry and consumers are entitled to.”
Many people in the industry are therefore angry that the SEC is taking a hard line by throwing lawsuits instead of entering into any kind of cooperation and clarity with crypto companies.
Despite the growing turmoil in the crypto country, it is important to realize that the SEC does not have the authority to actually label certain assets as securities. The SEC is only an enforcer of the law and only a judge or a new law can determine whether and which crypto may meet the requirements to qualify as a security.
In that regard, the outcome of the lawsuit between Ripple and the SEC will be very important for the future course of the regulator’s claims.