Solana, Cardano Dropped As Securities In SEC Binance Update

The US Securities and Exchange Commission (SEC) has amended its complaint in the lawsuit against Binance, delivering massively bullish news for Solana (SOL) and Cardano (ADA). This amendment involves a crucial adjustment regarding the classification of ten cryptocurrencies, including Solana and Cardano, which were initially labeled as securities in the SEC’s comprehensive legal action against Binance and its former CEO, Changpeng Zhao.

The original complaint, lodged on June 5, 2023, by the SEC, targeted Binance along with its US affiliate, BAM Trading Services Inc. The agency’s charges centered on allegations that these entities operated without the necessary registrations for functioning as national securities exchanges, broker-dealers, and clearing agencies. This lack of registration purportedly allowed Binance to run an unregulated trading platform, thereby exposing US investors to significant risks and purportedly misleading them regarding the security and regulatory oversight of their investments.

Today, on July 30, the US agency filed an amendment to its complaint concerning “Crypto Asset Securities.” This adjustment obviates the immediate need for the court to rule on the sufficiency of the allegations related to these tokens.

The document elaborates, “The SEC informed Defendants that it intends to seek leave to amend its Complaint, specifically concerning the ‘Third Party Crypto Asset Securities’ as defined in the SEC’s Omnibus Opposition to Defendants’ Motion to Dismiss, Dkt. No. 172, thereby eliminating the necessity for the court to assess the sufficiency of the allegations regarding those tokens at this juncture.”

Notably, the SEC initially designated ten cryptocurrencies including Binance Coin (BNB), Binance USD (BUSD), Solana (SOL), Cardano (ADA), Polygon (MATIC), Cosmos (ATOM), The Sandbox (SAND), Decentraland (MANA), Axie Infinity (AXS), and COTI (COTI) as securities.

Despite the potentially bullish implications of the SEC’s decision to amend its classification of certain tokens, there has been no significant market reaction thus far. At the time of reporting, the Solana price has decreased by -5.5% and Cardano by -4.5% over the past 24 hours. Similarly, the other cryptocurrencies mentioned in the SEC’s initial complaint have not shown any notable market movements, aligning with the broader market sentiment, which has been influenced by recent negative news about Bitcoin, particularly concerning the US government’s potential sale of up to 29,800 BTC.

DeFi^2 (@DefiSquared), the top-ranked crypto trader on Bybit, commented via X: “Market faded this move for some reason, but it actually seems like pretty significant news for the coins no longer being classified as securities? Short term implications include a likely imminent Robinhood re-listing, and longer-term, improved chances of new ETF approvals.”

The Cboe has formally requested the SEC’s approval to allow asset managers VanEck and 21Shares to launch a spot Solana-based exchange-traded fund (ETF) in early July. This request was articulated through a pair of 19b-4 filings submitted to the Securities and Exchanges Commission, proposing these products for listing, contingent on regulatory approval.

At press time, Cardano traded at $0.4015.