News

New Lawsuit Alleging That Solana Is A Security Could Have Big Implications For The Crypto Investment Landscape

Yesterday we posted about the SEC insider trading case which is attempting to claim that crypto assets are securities and trading on material, non-public information regarding them violates the federal securities laws.

SEC Files First Crypto Insider Trading Case, But the Trading Doesn’t Involve a Security

Today we learned of a class action lawsuit filed against Solana Labs, a for-profit company working on the development of the Solana blockchain, in a California federal court last week accusing the company and people within the ecosystem of making illegal profits and promoting its token, SOL, as an unregistered security.

From Forbes:

The outcome of the lawsuit could have major implications for the future of the crypto industry, which has had to function for years under a cloud of uncertainty about whether its tokens should qualify as securities. If SOL is determined to be a security, it could open up many similar tokens available on prominent crypto exchanges such as Coinbase, Kraken, Binance, and others to similar scrutiny. Ultimately these platforms could be forced to de-list SOL and other major crypto tokens. For context, Coinbase and Kraken, along with many other platforms de-listed XRP in late 2020 when the SEC sued San Francisco-based Ripple for selling $1.3 billion of the asset to purchasers in what it called an unregistered security.

Securities Attorney at Sallah Astarita & Cox | 212-509-6544 | mja@sallahlaw.com | Website | + posts

Mark Astarita is a nationally recognized securities attorney, who represents investors, financial professionals and firms in securities litigation, arbitration and regulatory matters, including SEC and FINRA investigations and enforcement proceedings.

He is a partner in the national securities law firm Sallah Astarita & Cox, LLC, and the founder of The Securities Law Home Page - SECLaw.com, which was one of the first legal topic sites on the Internet. It went online in 1995 and is updated daily with news, commentary and securities law related links.

The Securities Lawyer