Cardano and the SEC: Hoskinson’s Stance on ADA’s Security Classification

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Cardano, a leading name in the blockchain sector, and its native token, ADA, are at the heart of a growing debate surrounding their classification by the U.S. Securities and Exchange Commission (SEC). Charles Hoskinson, Cardano’s visionary founder, has shared his thoughts on the matter, offering insight into the intricate dynamics of the crypto world.

Hoskinson’s Assurance to ADA Holders

Despite the apprehensions in the market, Charles Hoskinson is confident that the SEC won’t pursue ADA. His recent dialogue on Corey Costa’s “Crypto Coins” segment on YouTube shed light on this. Hoskinson emphasized that no enforcement actions have been directed at ADA. Surprising, even with the token being highlighted in certain legal controversies against prominent crypto platforms.

A closer look reveals that the SEC’s lens has been predominantly on leading crypto exchanges, notably Coinbase and Binance. In the lawsuits against these exchanges, the commission classified multiple tokens as securities. The list includes, but isn’t limited to, Cardano’s ADA, Binance Coin (BNB), Solana (SOL), Polygon (MATIC), and Filecoin (FIL). The SEC’s stance is clear: these tokens should be registered before exchanging listings.

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Brian Armstrong, Coinbase’s top executive, unveiled that the SEC had suggested the platform to sideline all tokens, except Bitcoin. He cited their potential characterization as securities.

Drawing parallels, the Ripple Labs and the SEC legal face-off has lasted for three tumultuous years. The core of the contention? Whether XRP, Ripple’s cryptocurrency, should be considered a security. The recent judgment declared that while XRP’s retail sales aren’t securities, its sales to institutions fall under that category.

Hoskinson Responds to SEC’s Cardano Approach

Hoskinson clarified ADA’s position by addressing concerns over the SEC’s perceived aggression towards Cardano and similar blockchain ventures. He stated, “To state it succinctly, no enforcement actions target Cardano, merely because a lawsuit labels a token as a security. As of now, ADA remains unaffected.”

He further delved into the motives behind the SEC’s persistent crypto clampdown. In his view, politics, rather than securities regulations, fuels these actions. He specifically pointed towards Sam Bankman-Fried, the once-celebrated founder of the now-defunct crypto exchange, FTX. Hoskinson says Bankman-Fried’s fall from grace parallels the infamous Bernie Madoff saga.

Hoskinson opined on the U.S. political arena’s role in the crypto drama. He suggested that a significant political faction in the U.S., having received hefty donations from Bankman-Fried, is in a quest to cleanse its image. The once cooperative approach to crafting crypto regulations now seems to lean towards pointing fingers and penal actions.

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