The US securities regulator hasn’t necessarily let Solana off the hook as a security

The United States securities regulator hasn’t necessarily let Solana off the hook as a security despite retracting its request for a court to decide

The United States securities regulator may still classify Solana as a security, despite retracting its request for a court to rule on the matter in its Binance lawsuit on July 30.

“There is no reason to think SEC has decided SOL is a non-security,” wrote Jake Chervinsky, chief legal officer at crypto-focused venture capital firm Variant Fund, in a July 30 X post.

Chervinsky's post pertains to the latest response from the US Securities and Exchange Commission, seeking to amend its complaint regarding the “Third Party Crypto Asset Securities.” In essence, the regulator is telling the court that it is no longer asking to determine whether the tokens listed in the lawsuit are securities or not.

While Chervinsky didn't elaborate on what that “litigation tactic” may be, he highlighted that the SEC still refers to the same tokens as securities in other crypto exchange lawsuits, including its one with Coinbase.

In separate posts, Miles Jennings, general counsel and head of decentralization at a16z Crypto, and Justin Slaughter, policy director at Paradigm, seemed to agree.

Slaughter argued that many are “overreading this filing” and that it doesn't mean the SEC has decided that Solana and other tokens are not securities.

Jennings explained that Judge Amy Berman Jackson had set such a high bar to establish the Howey test in the Binance case that it wasn't worth the SEC's time and effort to prove these tokens were securities.

However, in the Coinbase lawsuit, Judge Katherine Polk Failla appeared to be more “inclined” to agree with the SEC's position — hence, it isn't bothering to make the same request that it made in the Binance lawsuit.

Jennings said he isn't convinced that the SEC has mounted a strong enough case to establish the connection between token sales on secondary markets and the managerial efforts of token issuers.

“Obviously, I'm speculating about their political motive, but that speculation is informed by information I'm privy to about the SEC's behavior behind closed doors,” he added.

In its suit against Binance, the SEC claimed several tokens were securities. The list includes Solana ( SOL ), BNB ( BNB ), Cardano ( ADA ), Polygon ( MATIC ), The Sandbox ( SAND ), Decentraland ( MANA ) and Axie Infinity ( AXS ).

The SEC once claimed that at least 68 tokens are securities, affecting more than $100 billion worth of cryptocurrencies in the market.