New Lawsuit Alleging That Solana Is A Security Could Have Big Implications For The Crypto Investment Landscape
A class action lawsuit has been filed against Solana Labs, a for-profit company working on the development of the Solana blockchain, in a California federal court last week accusing the company and people within the ecosystem of making illegal profits and promoting its token, SOL, as an unregistered security. The outcome of the lawsuit could have major implications for the future of the crypto industry, which has had to function for years under a cloud of uncertainty about whether its tokens should qualify as securities. If SOL is determined to be a security, it could open up many similar tokens available on prominent crypto exchanges such as Coinbase, Kraken, Binance, and others to similar scrutiny. Ultimately these platforms could be forced to de-list SOL and other major crypto tokens. For context, Coinbase and Kraken, along with many other platforms de-listed XRP in late 2020 when the SEC sued San Francisco-based Ripple for selling $1.3 billion of the asset to purchasers in what it called an unregistered security. The lawsuit was filed by the plaintiff, Mark Young, with Roche Freedman LLP and Schneider Wallace Cottrell Konecky on behalf of all investors who bought Solana (SOL) tokens from March 24, 2020 through the present.