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List of Cryptocurrencies Classified as Security by U.S. SEC in Binance Suit

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  • The U.S. SEC has identified 12 coins and tokens as securities being offered by Binance.
  • Securities, in the context of U.S. laws, refer to financial instruments or investment contracts that represent ownership in a company, debt obligations, or rights to a certain portion of profits or assets.
  • The SEC has filed charges against Binance CEO Changpeng Zhao (CZ) for allegedly violating securities laws by offering and selling digital asset securities to US residents without registering with the SEC.

Following the lawsuit of the U.S. Securities and Exchange Commission (SEC) against the cryptocurrency exchange Binance on allegations of violating federal securities laws, the American Commission named 12 cryptocurrencies as securities.

SEC Tags 12 Cryptocurrencies as Securities

The lawsuit specifically identified six coins and six tokens as securities being offered by Binance. 

Coins

Coins are independent cryptocurrencies that operate on their own blockchain networks, designed to function as mediums of exchange, stores of value, or units of account. 

  1. $BNB (Binance Coin)
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BNB is the native cryptocurrency of the Binance exchange. It is used for various purposes within the Binance ecosystem, including paying for transaction fees, participating in token sales, and more.

In 2022, the US SEC also probed Binance over the 2017 initial coin offering of BNB tokens.

As of writing, BNB is trading at $276.53 and is down by 9% according to CoinGecko. It is still ranked fourth on the top cryptocurrencies. 

  1. $SOL (Solana)

It is the native cryptocurrency of Solana, a blockchain platform designed for decentralized applications and crypto-assets. 

Ranked 10th on the top cryptocurrencies, SOL is currently valued at $19.92, however, it has been down by 8.3% for the last 24 hours, according to the data from CoinGecko.‌

  1. $ADA (Cardano)

The native cryptocurrency of Cardano, a blockchain platform that aims to provide a more secure and sustainable infrastructure for the development of decentralized applications. 

ADA is currently trading at $0.350669, and has decreased by 7.1% for the last 24 hours. It is ranked by CoinGecko at #8. 

  1. $FIL (Filecoin)

Filecoin is a decentralized storage network that enables users to rent out their spare storage space or purchase storage from others using $FIL. 

Currently ranked as Top 33 on CoinGecko, FIL is trading at $4.23, as of writing, down by 8.4% for the last 24 hours.

  1. $ALGO (Algorand)

Algorand is a blockchain platform focused on scalability, security, and decentralization. $ALGO is the native cryptocurrency of the Algorand network and is used for transactions and participating in the network’s consensus.

On June 6, 2023, the value of the crypto dipped from its June 5 price of $0.0149518 to $0.0135236. Currently it is valued at $0.136626 and was down by 9.7% for the last 24 hours. 

  1. $ATOM (Cosmos)

Cosmos is a network of independent blockchains that can interoperate with each other. $ATOM is used for staking, governance, and securing the network by participating in consensus.

As of writing, ATOM is trading at $9.97; it has decreased in value by 7% for the last 24 hours as per CoinGecko.

Tokens

Tokens are cryptocurrencies built on existing blockchain platforms, utilizing their infrastructure to represent various things such as utility tokens, digital assets, or ownership of physical assets. 

  1. $BUSD (Binance USD)

BUSD is a stablecoin issued by Binance in partnership with Paxos. It is pegged to the value of the U.S. dollar and is designed to provide stability and liquidity in the cryptocurrency market.

Priorly, blockchain and trust company Paxos faced a lawsuit filed by the SEC for issuing BUSD together with  its own stablecoin, Pax Dollar (USDP), for “violating investor protection laws.” 

According to Coingecko, it only went down by 0.1% and is currently valued at $0.999479. It is ranked 15th among the top cryptocurrencies on the platform. 

  1. $MATIC (Polygon)

Polygon is a layer 2 scaling solution for Ethereum, offering faster and cheaper transactions. Polygon issued the MATIC token, which is used for transactions, staking, and participating in the network’s governance.

CoinGecko’s rank #11, MATIC is currently trading at $0.830582 and was seen to be down by 6%.

  1. $SAND (The Sandbox)

The Sandbox is a virtual world where players can create, own, and monetize their gaming experiences using non-fungible tokens (NFTs). The SAND token is the native currency of The Sandbox ecosystem.

One of the biggest declines among the flagged crypto tokens was SAND as it went down by 10.9% and is currently trading at $0.520964. 

  1. $MANA (Decentraland)

Decentraland is a virtual reality platform built on the Ethereum blockchain. $MANA can be used by users to buy, sell, and trade virtual land and assets within the platform.

Decentraland’s MANA also went down for the last 24 hours as the value decreased by 9.6%; it is currently priced at $0.454596. 

  1. $AXS (Axie Infinity Shards)

Axie Infinity is a blockchain-based game where players can collect, breed, raise, and battle digital creatures called Axies. AXS is the utility token of the Axie Infinity ecosystem and is used for various in-game activities.

The play-to-earn game’s utility token also went down in value by 7%. The token is currently trading at $6.61.

  1. $COTI (COTI)

COTI is a blockchain platform that aims to provide scalable and user-friendly solutions for businesses, including payments, digital currencies, and decentralized finance (DeFi) applications. $COTI is used for transactions and participating in the network’s consensus.

As of writing, $COTI is trading at $0.061416 and is down by 8.4% according to CoinGecko

What are Securities?

Securities, in the context of U.S. law, refer to financial instruments or investment contracts that represent ownership in a company, debt obligations, or rights to a certain portion of profits or assets. They are regulated by the US Securities and Exchange Commission (SEC) and subject to specific laws and regulations designed to protect investors and ensure fair and transparent markets.

The classification of an asset as a security is important because it determines the legal framework and regulatory requirements that apply to its issuance, trading, and disclosure. Compliance with securities laws is crucial to ensure investor protection, prevent fraud, and maintain market integrity.

Last February, Gary Gensler, the current chair of the US Securities and Exchange Commission (SEC), stated that he believes “everything other than BTC” should be classified as a security. He then emphasized that the SEC possesses the necessary legal tools to regulate these assets.

According to Gensler, with the exception of Bitcoin spot transactions and crypto used in the sale or purchase of goods and services, all other crypto transactions fall under the SEC’s jurisdiction. 

U.S. SEC vs. Binance Lawsuit

The U.S. SEC also filed charges against Changpeng Zhao (CZ), the CEO of Binance, a prominent cryptocurrency exchange. The charges alleged that CZ violated securities laws by offering and selling digital asset securities to US residents without registering with the SEC.

The SEC also claimed that Binance operated an unregistered securities exchange and failed to provide required disclosures to investors. This development highlights the SEC’s increased scrutiny of the cryptocurrency industry and its efforts to enforce regulations to protect investors.

This article is published on BitPinas: List of Cryptocurrencies Classified as Security by U.S. SEC in Binance Suit

Disclaimer: BitPinas articles and its external content are not financial advice. The team serves to deliver independent, unbiased news to provide information for Philippine-crypto and beyond.