In a recent lawsuit filed by the United States Securities and Exchange Commission (SEC) against Binance, the SEC classified several prominent cryptocurrencies, including Cardano (ADA), as securities. However, the Cardano Foundation’s CEO has disagreed with this classification, emphasizing the need for regulatory clarity in the industry.
Cardano Foundation’s Stance $ADA Security Classification
Under US law, the recent classification of ADA as a security by the SEC has been met with disagreement from Frederik Gregaard, CEO of the Cardano Foundation. The Cardano Foundation engages with regulators and policymakers to achieve legal clarity and certainty.
SEC Chair Gary Gensler has consistently maintained that most crypto assets are securities, except for Bitcoin (BTC).
According to the Bloomberg report, these assets are considered investment contracts and should be registered with the agency. Ripple, a blockchain company, has been engaged in a legal battle with the SEC, as it accuses Ripple of illegally issuing and selling the XRP token, which the SEC views as a security rather than a commodity.
US SEC Lawsuits and Potential Delisting on Robinhood
The SEC has recently filed lawsuits against leading crypto exchanges, including Binance and Coinbase, alleging that they offered digital assets such as Cardano, Solana, Polygon, and Binance Coin without proper registration as securities. Consequently, popular cryptocurrencies such as Cardano (ADA), Solana (SOL), and Polygon (MATIC) face the possibility of delisting from the Robinhood trading platform.
Robinhood has indicated that it may remove tokens implicated in the SEC lawsuit against Binance and Coinbase. Suppose a cryptocurrency is determined to be a security and has not been registered with the SEC. In that case, US-based exchanges like Robinhood cannot legally facilitate trading those tokens. Therefore, Robinhood might have to delist these cryptocurrencies to comply with US securities laws.
Cardano’s Journey on Robinhood and Broader Crypto Offerings
In September 2022, Robinhood, a Nasdaq-listed online brokerage, added support for the ADA cryptocurrency associated with the Cardano blockchain. This expansion of crypto offerings was part of Robinhood’s broader strategy to grow its presence in the cryptocurrency space following the introduction of crypto trading on its platform in early 2018.
However, as it was reported earlier about a potential risk of Cardano being delisted from Robinhood, Robinhood is contemplating delisting cryptocurrencies that the SEC deems as unregistered securities, including Solana, Cardano, and Polygon.
As the crypto industry grapples with regulatory challenges, achieving clarity and certainty in regulations remains crucial. Both industry players and regulatory bodies must engage in ongoing discussions to balance innovation and compliance. Meanwhile, Cardano is trading at $0.3323, down by 5.47% in the last 24 hours.
The presented content may include the personal opinion of the author and is subject to market condition. Do your market research before investing in cryptocurrencies. The author or the publication does not hold any responsibility for your personal financial loss.