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Crypto market prices have tumbled significantly since the news began to make rounds.
Altcoins like Solana (SOL), Cardano (ADA), Polygon (MATIC) and many other tokens face the possibility of being delisted from Robinhood Markets Inc (NASDAQ: HOOD), after the United States Securities and Exchange Commission (SEC) charged Binance and Coinbase Global inc (NASDAQ: COIN) for trading unregistered securities.
At present, Robinhood is taking another look at the digital assets offerings on its platform to “determine what, if any, actions to take”, according to Dan Gallagher, a one-time SEC Commissioner and the present Chief Legal Officer at Robinhood.
In the lawsuit which was filed by the SEC against Binance, the regulator categorized BNB, BUSD, SOL, ADA, MATIC, FIL, ATOM, SAND, MANA, ALGO, AXS, and COTI as securities. Coinbase was not left out as the SEC also stated that SOL, ADA, MATIC, FIL, SAND, AXS, CHZ, FLOW, ICP, NEAR, VGX, DASH, and NEXO all fall under the securities class.
Robinhood Tokens Scrutiny and Broad Crypto Market Reaction
These lawsuits were filed simultaneously against the two prominent digital asset service providers.
Unfortunately, the broad crypto industry has had to bear the brunt of these enforcement actions. Crypto market prices have tumbled significantly since the news began to make rounds. A few hours after SEC indicted Binance, Bitcoin (BTC) price dipped by 5%, Ethereum (ETH) suffered a similar fate, and other altcoins like SOL, ADA, MATIC, and even Dogecoin (DOGE) also fell in terms of price.
Dune Analytics data showed that Binance experienced huge outflows of up to $635 million after the lawsuit.
Coinbase shares value fell by 10.3% and by the end of the trading day, it was down by 9%. Considering the huge effect on the crypto market, Edward Moya, a senior market analyst at foreign exchange Oanda mentioned that it was a reflection of investors’ concerns over the U.S. regulatory crackdown on cryptocurrency. Investors have fears that in the long run, many digital assets would be categorized as securities.
Meanwhile, many crypto heavyweights have pledged support for the crypto exchanges against the SEC. Cardano boss Charles Hoskinson urged top crypto industry players to unite to combat the authoritarianism of the SEC and other regulatory agencies. This is not a far cry from what Coinbase was trying to achieve when it filed a lawsuit against SEC requesting that the regulator provide clarity in its regulation framework for crypto.
“The SEC is talking out of both sides of its mouth, and it is wrong at each end. The Chair’s statements cannot provide fair notice of the obligations of regulated parties – that is the function of rulemaking, which Coinbase’s petition requests. But the SEC’s Chair undoubtedly can and does speak authoritatively for the agency he leads in describing its regulatory agenda,” Coinbase stated at the time.
Looking on the bright side, within the last 48 hours, the top three largest Decentralized Exchanges (DEXs): Uniswap v3 (Ethereum), Uniswap v3 (Arbitrum), and PancakeSwap v3 (BSC) have recorded a 444% jump in median trading volume, according to crypto data aggregator CoinGecko.