In a major decision taken on the 8th of August, Bitstamp has announced that it would suspend trading for several cryptocurrencies identified as securities by the SEC in cases against Binance and Coinbase.
The impacted tokens will no longer be available to trade by the end of August.
Bitstamp Moves To Suspend Tokens
According to the announcement, several prominent cryptocurrencies will soon be blocked, rendering US-based users unable to trade them. These include Axie Infinity (AXS), Decentraland (MANA), Chiliz (CHZ), Near Protocol (NEAR), Polygon (MATIC), The Sandbox (SAND), and Solana (SOL). As per the company’s announcement, after delisting the above-mentioned cryptocurrencies, the platform will offer only 30 listed cryptocurrencies. The cryptocurrency exchange urged users to execute all trades involving these tokens by the 29th of August, following which they will become unavailable.
“Update for our US users Starting the 29th of August: AXS, CHZ, MANA, MATIC, NEAR, SAND, and SOL trading will be halted after evaluating recent market developments. Execute any open trades. Holding and withdrawing tokens afterwards will be unaffected.”
According to the exchange, US trading of the tokens will be permanently disabled after the 29th of August. However, customers can still withdraw and hold the tokens after the date.
“We kindly request our users to promptly execute any desired buy or sell orders involving the affected assets before the 29th of August, 2023. After this deadline, trading activities related to AXS, CHZ, MANA, MATIC, NEAR, SAND, and SOL will be permanently disabled on the Bitstamp platform.”
“Recent Developments” Led To Decision
The announcement pointed at recent market developments as the reason behind the suspension of trading of the cryptocurrencies mentioned. While the firm did not provide a concrete reason, all of the tokens mentioned in the announcement have been alleged to be unregistered securities by the United States Securities and Exchange Commission (SEC). The Securities and Exchange Commission identified the cryptocurrencies in question as unregistered securities in separate complaints against Binance and Coinbase.
However, Bitstamp has not delisted other assets mentioned in the cases against Binance and Coinbase. These assets include Nexo (NEXO), Algorand (ALGO), and Cardano (ADA).
Other Platforms Have Also Delisted Assets
The allegations against the tokens made by the Securities and Exchange Commission have yet to be proven in a court of law. However, other platforms have voluntarily delisted specific assets mentioned by the SEC in the cases. In recent months, several platforms, including Bakkt, Robinhood, and Revolut, have delisted Polygon (MATIC), Cardano (ADA), and Solana (SOL).
The platforms seem to have delisted these three cryptocurrencies because they are among the largest assets which the SEC targets. Following the developments, projects such as The Sandbox have also started mandating Know Your Customer (KYC) verification for SAND staking. According to the SEC, a total of 68 cryptocurrencies are unregistered securities.
Crypto Projects Reject Claims
However, cryptocurrency projects have repeatedly rejected the claims made by the Securities and Exchange Commission, either directly or indirectly. The Solana Foundation, in a statement, has said that it categorically disagrees with the SEC’s observations. Cardano’s parent company IOHK has also denied ADA’s security status. Meanwhile, Polygon Labs has said its operations were focused outside the US, beyond the reach and jurisdiction of the SEC. From the looks of things, it appears that actions taken around the assets in question are precautionary, and it remains to be seen if the SEC will take any action against the tokens or platforms in the future.
SEC Action Against Binance And Coinbase
The Securities and Exchange Commission’s suits against Coinbase and Binance have led to an uncertain future for major listed tokens. The regulatory body’s two lawsuits against the crypto exchanges in question have cast a long shadow on the 19 tokens mentioned in both filings. The SEC has accused Binance and Coinbase of offering unregistered securities to the public through their respective platforms. The suit once again brings into focus lingering questions about whether cryptos are a security, commodity, or otherwise.
Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.
