Cardano Developer Rejects SEC Claim Its ADA Token Is a Security

Cardano development company IOG dismissed U.S. Securities and Exchange Commission (SEC) claims that ada (ADA), the blockchain’s native token, can be viewed as a security.

IOG said SEC lawsuits filed earlier this week against crypto exchanges Binance and Coinbase, which included ADA in a list of crypto tokens that count as securities, contained “numerous factual inaccuracies.” The allegations will have no impact on IOG’s operations, the company said in a Friday statement.

“Under no circumstances is ADA a security under U.S. securities laws. It never has been,” IOG said. “Understanding how decentralized blockchains operate is a fundamental component in creating responsible legislation.”

IOG said regulation through enforcement actions does not provide the necessary clarity or certainty that both the blockchain industry and consumers deserve.

The ADA price fell 3% in the past 24 hours as tokens named in the SEC lawsuit extended their sell-off as traders reacted to regulatory risk.

The SEC also identified tokens issued by foundations and companies or tied to protocols Polygon (MATIC), Sandbox (SAND), Filecoin (FIL), Axie Infinity (AXS), Chiliz (CHZ), Flow (FLOW), Internet Computer (ICP), Near (NEAR), Voyager (VGX), Dash (DASH) and Nexo (NEXO) as securities.