The US regulator SEC declared 18 more altcoins as securities as part of the Binance and Coinbase lawsuits last week. Among them were the top 10 altcoins such as Cardano (ADA) and Solana (SOL). With recent developments, the SEC’s list of ‘crypto securities’ exceeds 60. What happened between the period of 2019-2023 is as follows…
Here are the altcoins that are considered securities by the SEC
To date, there are more than 60 altcoins recognized as securities by the SEC. One of the first cases emerged with the lawsuit he filed against Ripple (XRP) in 2020. As part of the SEC-Ripple lawsuit, what former SEC executive William Hinman said in 2018 was recently made public. Hinman said that Ethereum was not a security at this time.
The SEC later declared a number of altcoins securities under different lawsuits in the following years. The most notable projects at the moment are as follows:
- Algorand (ALGO)
- Axie Infinity (AXS)
- Binance Coin (BNB)
- Binance USD (BUSD)
- Cardano (ADA)
- Chiliz (CHZ)
- Cosmos (ATOM)
- Decentraland (MANA)
- Filecoin (FIL)
- Luna
- Polygon (MATIC)
- Ripple (XRP)
- Left (LEFT)
- Terra USD (UST)
- The Sandbox (SAND)
- Tron (TRX)
What do these altcoins have in common?
The SEC uses the Howey test to determine whether these cryptocurrencies are securities. However, what most current ‘securities’ share or have in common is as follows:
- Most of them had an ICO (Initial Coin Offering). As a result of brutal SEC lawsuits, new ICOs exclude US citizens.
- Altcoins had use cases in finance. For example, the main purpose of these cryptocurrencies is to secure the network through staking. PoW or PoS is irrelevant.
Negative effects of SEC pressure for the US
The SEC is an agency with jurisdiction only in the US territory. Other countries or regions may deal with cryptocurrencies differently. For example, in Europe there is MICA. The EU region is currently aiming to become the home of crypto companies with the new law going into effect 2024. This means that companies fleeing the US can now operate comfortably in Europe.
Elsewhere, Hong Kong opened to the crypto market on June 1, 2023. They are now proactively sending messages to US-based companies to relocate to Hong Kong. cryptocoin.com We have included offers for Coinbase following the SEC lawsuits in this article.
What methods does it use?
The SEC uses the ‘Howey test’ to determine that an altcoin is a security. However, the history of this test dates back to 1946. That was long before any cryptocurrency existed. Therefore, the regulation needs to be updated. Mark Cuban, a well-known name in the crypto market, recently made a call in this direction:
Unfortunately, none of the elements presented on the SEC’s website are part of the registration process. This makes it nearly impossible to know what a security is or isn’t in the crypto universe, whether there is an army of securities lawyers or not.
To summarize, there is a large community that feels the SEC is lacking in cryptocurrency regulations. According to Coinbase CEO Brian Armstrong, the SEC is unable to offer a clear rule that exchanges must follow. In the past months, Coinbase has requested the SEC to introduce a “clear rule” on this issue. On the last day of the one-week period, the SEC requested another 120 days.
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