- SEC retracts request to classify ADA, MATIC, and SOL as securities in Binance suit.
- Affected tokens include ADA, MATIC, SOL, BNB, BUSD, and others.
- The shift in SEC’s stance follows increased pro-crypto political support in the US.
In a notable shift in regulatory stance, the US Securities and Exchange Commission (SEC) has withdrawn its request for a court ruling to classify certain cryptocurrencies, including Cardano’s ADA, Polygon’s MATIC, and Solana’s SOL, as securities in its ongoing lawsuit against the cryptocurrency exchange Binance.
This development marks a significant change in the SEC’s approach to the classification of these digital assets.
SEC no longer views ADA, SOL and MATIC as securities
On July 30, 2024, the SEC filed a response to the court’s minute order issued on July 9, 2024. In the filing, the SEC indicated its intention to amend its complaint concerning what it previously referred to as “Third Party Crypto Asset Securities” in its opposition to Binance’s motion to dismiss.
By retracting this request, the SEC has effectively removed the need for a judicial ruling on whether these tokens should be classified as securities at this time.
While the immediate tokens affected by this retraction are ADA, MATIC, and SOL, other prominent cryptocurrencies such as Binance Coin (BNB), Binance USD (BUSD), Cosmos(ATOM), The Sandbox(SAND), Decentraland (MANA), Axie Infinity (AXS), and COTI.
SEC’s retraction follows the SEC’s earlier stance, which had identified at least 68 tokens as securities, impacting a significant portion of the cryptocurrency market valued at over $100 billion.
SEC’s move coincides with increased pro-crypto political support in the US
The SEC’s change of stance appears to be influenced by recent political developments as the US Presidential candidates increasingly voice pro-crypto sentiments, impacting regulatory attitudes.
Former President Donald Trump, in his election campaign, has pledged to end the so-called “war on crypto” and expressed intentions to replace SEC Chair Gary Gensler with a more crypto-friendly figure.
Concurrently, members of the Democratic Party have advocated for a more progressive approach to digital assets.
This adjustment by the SEC underscores a broader, evolving narrative in US regulatory attitudes towards cryptocurrencies, reflecting a growing recognition of the sector’s significance and potential.