- The US Securities and Exchange Commission (SEC) has classified 68 cryptocurrencies as securities, due to recent lawsuits against major crypto exchanges Coinbase and Binance.
- This significant action impacts over $100 billion worth of tokens in the market.
As the regulatory landscape of the crypto world shifts, the U.S. Securities and Exchange Commission (SEC) has made a significant move. In recent lawsuits against crypto giants Binance and Coinbase, the SEC has classified 68 cryptocurrencies as securities, marking a major change for the industry.
The sale of XRP on exchanges is NOT a security. Which means the sales of all cryptos on exchanges are NOT securities and @SECGov and @GaryGensler have NO jurisdiction over them. This is a watershed moment that relegates the SEC to TradFi and makes it a dinosaur regulator. Buh-bye pic.twitter.com/PRuumqQBEL
— Cameron Winklevoss (@cameron) July 13, 2023
Decoding the SEC Lawsuits
From years of litigation, the SEC has compiled a list of cryptocurrencies that it now considers securities. Following its lawsuit against Binance, the regulatory body added ten cryptocurrencies to this classification. Among these are high-profile tokens such as Binance’s native token BNB, Solana (SOL), Cardano (ADA), and Polygon (MATIC), among others.
In the SEC’s case against Coinbase, thirteen cryptocurrencies were highlighted. The commission reinforced the classification of SOL, ADA, MATIC, along with other tokens and added an additional six, including Chiliz (CHZ), Flow (FLOW), and Internet Computer (ICP).
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Noteworthy cryptocurrencies that the SEC previously classified as securities include Ripple’s XRP, LBRY’s LBRY Credits (LBC) – excluding secondary sales – and Algorand (ALGO). These designations were made when the SEC charged Bittrex in April.
The SEC’s largest one-time classification occurred when it accused Terraform Labs of fraud in February. A total of 16 crypto assets were labeled as securities, including Mirror Protocol (MIR) and 13 Mirrored Assets (mAssets) that aim to replicate the prices of major stocks like Apple and Tesla.
An Expansive Reach in the Crypto Space
By declaring these tokens as securities, the SEC’s authority now spans across more than $100 billion of the market, which is roughly 10% of the total $1.09 trillion crypto market capitalization.
This extensive classification, however, has not come without dispute. SEC Chair Gary Gensler’s assertion that “everything other than Bitcoin” is a security under the agency’s purview has sparked intense debates within the crypto community, given the vast number of cryptocurrencies listed on data sites like CoinMarketCap – approximately 25,500 to date.
Such assertions underline the evolving regulatory environment for cryptocurrencies and the SEC’s intent to increase its oversight. It remains essential for investors and exchanges to stay updated on these developments to navigate this dynamic landscape effectively.
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