The U.S. securities regulator recently classified certain cryptocurrencies, such as Algorand (ALGO) and Flow (FLOW), as securities in legal proceedings, which caused their prices to drop to their lowest levels ever.
On the 10th of June, ALGO and FLOW both reached their respective all-time lows of $0.098 and $0.46, having declined by approximately 30% over the course of the past week, as per CoinGecko data.
Since June 10, both ALGO and FLOW have experienced a slight rebound, with ALGO increasing by more than 12.5% and FLOW regaining about 10.5%.
Last week, the Securities and Exchange Commission (SEC) took legal action against crypto exchanges Binance and Coinbase on June 5 and 6 respectively. As part of the proceedings, it identified 16 new cryptocurrencies as securities, among them FLOW and Internet Computer (ICP).
The SEC’s case against Binance featured ALGO, but it was initially mentioned in its April lawsuit against Bittrex.
ICP has experienced a decline of approximately 25% over the last seven days, and is currently trading at $3.65, only 25 cents away from its record low of $3.40 set in December 2022.
The creators of Solana (SOL), Cardano (ADA), and Polygon (MATIC) have all strongly denied the SEC’s assertion that their projects are securities, after they were included in the SEC’s securities net.
On June 10, Polygon Labs tweeted without directly referring to the SEC’s definition of MATIC in response to the regulator.
The SEC charges against Binance and Coinbase are detrimental to the DeFi sector.
It highlighted that Polygon was developed and deployed outside the United States, and that MATIC was made available worldwide without any actions directed towards the U.S. at any time.
The Solana Foundation tweeted on June 10 that they do not agree with labeling SOL as a security.
IOG, the Cardano development company, declared on June 7th that they were cognizant of the SEC’s definition of ADA, and asserted that the SEC contained “numerous factual inaccuracies”.
“ADA is in no way considered a security under U.S. securities laws, and never has been,” the company declared in a blog post.
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