SEC pauses securities allegations against Solana, Cardano and Polygon in Binance lawsuit

The U.S. Securities and Exchange Commission (SEC) has decided to stay claims by Solana, Cardano, and Polygon that their native crypto assets are unregistered securities as part of the ongoing lawsuit against Binance.

The U.S. Securities and Exchange Commission has stated its intention to halt claims that Solana (SOL), Cardano (ADA), and Polygon (MATIC) are unregistered securities.

The SEC has filed a joint status report with the U.S. District Court for the District of Columbia, outlining plans to amend its July 29 complaint against cryptocurrency exchange giant Binance, including changes to “third-party crypto asset securities.” The move could provide temporary relief to the aforementioned entities, which have been under intense scrutiny and in danger of being removed from trading platforms due to the lawsuit and implicit regulatory uncertainty.

According to the joint response, the SEC and Binance have agreed on a schedule for the filing of the revision request and related briefings, and the SEC’s revision request must be filed within 30 days of the court’s scheduling order. For now, SOL, ADA, and MATIC investors can breathe easy, but the judge may still have to decide whether these tokens should be considered securities in the U.S.

Despite the news, SOL is down over 5% on the day, while ADA and MATIC have suffered 24-hour losses of around 4% and 1%, respectively, according to data from crypto.news.

In June 2023, the SEC filed lawsuits against Binance and Coinbase, accusing the exchanges of facilitating trading in unregistered securities. In both cases, which are yet to be resolved, the financial regulator stated that other tokens such as Dash (DASH), Filecoin (FIL), and NEAR Protocol (NEAR) should also be classified as securities.

Following the SEC’s allegations, the Solana Foundation and Polygon Labs have publicly disagreed with the SEC’s assessment, emphasizing their commitment to operating outside of U.S. markets. Despite these stances, platforms like Robinhood and Revolut have delisted tokens targeted by the SEC.