Sunday, May 26, 2024

Solana’s SOL is alleged to be an unregistered security in a class action lawsuit.

A lawsuit has been filed against Solana Labs crypto company, alleging it is running a security that is not registered with the authorities. Schneider Wallace and Roche Freedman LLP on July 1 filed a class action lawsuit for their plaintiff Mark Young in a district court.

The lawsuit claims Solana Labs, its Solana Foundation, Kyle Samani, Multipoint Capital Management, FalconX and Anatoly Yakovenko sold unregistered SOL security tokens. Defendants are accused of making lots of profits by selling SOL securities in the US to the retail investors. The sales violate the registration rules of state and federal security laws. The investors of these assets have lost their investments in the securities, according to the lawsuit.

The lawsuit plaintiff is seeking action for self and SOL investors. The lawsuit claims Solana Labs continues to issue misleading statements regarding the total supply of its tokens. The lawsuit claims that Anatoly Yakovenko, the founder of Solana Labs, lent in April 2020 assets to a market operator. The amount exceeded 11.3M tokens of SOL. The operator did not release this information. The company claimed it will reduce this much supply but reduced it only by 3.3M tokens.

The plaintiffs claim Solana is not a decentralized platform as it claims. Insiders hold 48% SOL supply, meaning it is a centralized network

The outcome of this lawsuit will have major implications not only for Solana but also for other crypto industry operators. It can lead to SOL being de-listed from most crypto exchanges in case the court decides it is a security.

Cryptured Team
Cryptured Team
The writers team at Cryptured.com is composed of passionate and experienced journalists who cover the latest developments in the crypto and blockchain space. They aim to provide accurate, unbiased and easy-to-understand news and information for their readers, as well as insights and analysis from industry experts. The writers team is always on the lookout for new and exciting stories that can help the general public learn more about the potential and challenges of these technologies.
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