Exchange Executive Declares End of Non-Securities Crypto Trading Era

Legal Ramifications of Crypto Exchanges’ Enforcement Actions

Amid lawsuits filed against U.S. exchanges like Coinbase and Binance.US, an executive at a domestic digital asset firm has commented on the legal ramifications of these recent enforcement actions for the industry.

Itai Avneri, the Chief Operating Officer of the blockchain trading firm INX, has declared that the period of trading cryptocurrencies as non-securities is drawing to a close. According to Avneri, the legal issues that have arisen are largely due to the huge number of coins available for trading on crypto exchanges.

“It’s no longer possible to trade cryptocurrencies as if they weren’t securities,” Avneri declared during an interview with Cointelegraph on June 19th. The executive went on to explain that INX had already foreseen this exact concept in their prospectus five years ago. “It’s almost as if we had a crystal ball in our possession,” he added.

CoinGecko’s data shows that Coinbase currently has 241 cryptocurrencies listed on its platform, providing more than 530 trading pairs. After reaching an agreement with U.S. regulators to put a stop to asset freezing, competitor exchange Binance.US still offers 154 cryptocurrencies for trading.

In comparison to Coinbase and Binance.US, INX has only listed five crypto assets since its inception in 2017. These coins are Bitcoin (BTC), Ether (ETH), USD Coin (USDC), Avalanche (AVA) and Litecoin (LTC), according to Avneri.

“That’s it,” the COO declared, emphasizing that INX is selective in regards to which cryptocurrencies they list on their platform. He also made it clear that INX should not be seen as a purely crypto company as their main focus is on digitized or tokenized securities.

INX’s Selective Crypto Listing Strategy

The Ripple case is nearing its end, but Brad Garlinghouse has said that the struggle for clarity must go on.

Avneri stated that Bitcoin is “definitely not a security,” and there is no definitive classification of Ether.

Avneri informed Cointelegraph that INX will find a means of listing ETH on its platform if it is ever considered a security.

The COO further indicated that INX sees potential in the fact that thousands of cryptocurrencies now require a method to be transformed into securities and listed on platforms like INX. “They must discover a way to be listed and to be officially registered with the SEC as securities,” Avneri declared, continuing:

Avneri’s recent statements echo similar sentiments expressed by the Chair of the United States Securities and Exchange Commission, Gary Gensler. In September of 2022, Gensler asserted that the majority of cryptocurrencies are securities. Before his appointment to the SEC, Gensler also proposed that more than 70% of crypto markets, including Bitcoin, Ether, Litecoin, Bitcoin Cash and others, are not securities.

INX has been reported to be one of the first companies to have their security token offering approved by the U.S. SEC, positioning itself as such.

The magazine states that Bitcoin is heading towards a goal of achieving ‘Net Zero’.