The entities behind Solana (SOL), Cardano (ADA), and Polygon (MATIC) have argued against what the Securities Exchange Commission (SEC) said about them being securities. Even though they all disagreed, each of the three organizations linked to the tokens showed different amounts of conviction.
Organizations behind Solana, Cardano and Polygon have disputed the recent claims of the SEC who classified them as securities.
— whalechart (@WhaleChart) June 12, 2023
The SEC recently claimed that Solana, Polygon, and Cardano are securities. However, the organizations behind popular cryptos have spoken in defense of them. In its lawsuit against Binance and Coinbase last week, the SEC used these three tokens. In addition to a number of others as examples of securities that were being sold and traded on crypto exchanges that didn’t follow the rules.
Solana, Polygon, and Cardano are some of the most well-known tokens in the lawsuit. According to CoinGecko, they are in the top 20 by market capitalization in the industry. The market capitalization of the three tokens is over $21 billion. In other words, it is about one-tenth of the overall value of Ethereum.
CoinGecko says that each of the three tokens has lost about 30% of its value in the past week. However, they had made a small comeback on Sunday, cutting back on some of the losses.
Cardano Standup For Itself
Cardano was the first of the big three altcoins to have a founding organization stand up for its regulatory status. The company that created Cardano, Input Output Global (IOG), said on June 6 that ADA has never been an asset under United States securities law.
Moreover, IOG said that the SEC’s new lawsuits will not affect the company’s operations “in any way.” Additionally, the company would like to work with regulators to preserve the possibility of innovation while protecting consumers.
“This latest filing from the SEC demonstrates that we still have a long way to go,” IOG noted. “Regulation through enforcement action does not provide either the clarity or certainty to which both the blockchain industry and consumers are entitled.”
Solana Standup For Itself
On Saturday, the Solana Foundation, a Switzerland-based non-profit group dedicated to Solana, sent out a similar message, though with less passion. Instead of just saying that Solana isn’t a security, the Solana Foundation said on Twitter that it “disagrees with the characterization of SOL as a security.”
The Solana Foundation disagrees with the characterization of SOL as a security. We welcome the continued engagement of policymakers as constructive partners on regulation to achieve legal clarity on these issues for the thousands of entrepreneurs across the U.S. building in the…
— Solana Foundation (@SolanaFndn) June 10, 2023
Just like IOG, the organization emphasized in its statement its desire to work with regulators and said that “regulatory clarity” is a problem that affects everyone in the “building” digital assets space in the United States.
In the meantime, members of the Solana community are discussing whether or not it would be possible to “fork” Solana. This means they are thinking about whether or not splitting off and making a new network. And figuring out which would be the best way to move forward. Like what Ethereum did after The DAO hack in 2016.
Some people, like HGE.ABC on Twitter, said it could also be a way to avoid the possible effects of FTX‘s bankruptcy. But, a large number of Solana tokens owned by Alameda Research, the trade company of former FTX CEO Sam Bankman-Fried, could be sold on the open market over the next few years.
The user said, “Community fork Solana will get rid of sec issue. No bankruptcy will dump on you for next 3 years continuously.”
Bold but not a bad idea actually. Community fork solana will get rid of sec issue.
Blink twice if you agree https://t.co/fWxbkMQ4aI
— HGE.ABC (@HGEABC) June 10, 2023
Polygon Standup For Itself
Polygon Labs posted on Twitter a few hours after the Solana Foundation commented about the SEC’s point of view. The company behind Polygon didn’t say that the token for its Ethereum scaling solution is not a security, nor did it address the SEC by name. But Polygon Labs did try to keep MATIC away from markets in the United States.
The company said that Polygon was created and used outside of the United States and called attention to a “global community that supports the network.” Polygon Labs said that MATIC was needed to protect its Polygon network from the time it launched.
In addition, Polygon Labs also said that it had acted in a way that didn’t target people in the U.S. This could be the start of a court dispute over who has the right to regulate MATIC.
Furthermore, they said, “We are confident in the actions we took in the past. Given our focus on network security, we made sure MATIC was available to a wide group of persons, but only with actions that did not target the U.S. at any time.”
Since the SEC sued Binance and Coinbase twice, the trading app Robinhood has said it will stop supporting Solana, Polygon, and Cardano. It said this is because the cases have “cast a cloud of uncertainty” over the three cryptocurrencies. Other companies might do the same thing. But for now, each coin’s group is doing its best to clear the name of its currency.