Solana (SOL) recently made headlines after being labeled as a “security” by the US Securities and Exchange Commission (SEC). As a result, SOL is facing challenges in its price movement.
In light of this regulatory setback, investors closely monitor SOL’s performance. According to CoinMarketCap, SOL is currently priced at $15.45, maintaining a seven-day downtrend of 23.13%.
Source: Coinmarketcap
As the market remains uncertain, one wonders: Will Solana be able to recover from its recent slump and regain its momentum?
SOL is facing huge downside as support level is broken
The past week has been a challenging one for Solana (SOL) as it experienced a massive decline, breaking the key support area from $16.7 to $18.8.
This downward spiral began with a weekend slump that coincided with Bitcoin (BTC) retesting $25,000. It turned into a bearish bias as SOL broke below trendline resistance and the March low of $16.
Solana’s price is on the downside. Source: Coinmarketcap
For SOL to gain bullish momentum, it will depend on bitcoin to hold above $26,600 and successfully surpass the $27,000 range. However, without this upward movement, the bulls may face challenges clearing the confluence area near the $17 level, which combines bullish order book support and trendline resistance.
A possible rejection at this critical juncture could send SOL price further down, potentially taking it towards the $14.9 or $12.8 support.
The Solana Foundation disagrees with the SEC’s label of SOL as a security.
In separate lawsuits filed on June 5 and 6 against popular cryptocurrency exchanges Binance and Coinbase, the SEC designated the SOL token as a security. The SEC’s classification was based on a variety of factors, including the expectation of profit to be derived from the efforts of others, as well as the way the token was used and promoted.
The Solana Foundation disagrees with the characterization of SOL as a security. We welcome the continued engagement of policymakers as constructive partners on regulation to achieve legal clarity on these issues for the thousands of entrepreneurs in the US building …
– Solana Foundation (@SolanaFndn) June 10, 2023
Addressing the SEC’s Classification of SOL as a Security, Solana Foundation took to twitter To express your disagreement. In a statement, the foundation stressed, “The Solana Foundation disagrees with the characterization of SOL as a security.”
According to the SEC, the term “security” includes not only traditional investment instruments such as stocks, bonds and transferable shares but also “investment contracts”.
The SOL market cap currently stands at $6.16 billion. Chart: TradingView.com
By labeling Solana as a security, the SEC signals its intention to subject the token to regulations governing securities, which could have significant implications for Solana and its ecosystem.
The classification will potentially spur further investigation and discussion about the nature and regulatory status of cryptocurrencies in the evolving legal landscape.
Featured Image from APKPure
source: www.newsbtc.com
