SEC-regulated firm INX only lists five cryptocurrencies on its platform, considering them non-securities.
Amid lawsuits against United States-based exchanges like Coinbase and Binance.US, an executive at a domestic digital asset firm has noted the legal implications of these recent enforcement actions for the industry.
The era of trading cryptocurrencies as non-securities is coming to an end, according to Itai Avneri, chief operating officer at the blockchain trading firm INX. Avneri believes that a massive amount of coins offered for trading on crypto exchanges is among the core reasons for legal issues.
“You cannot continue to trade cryptocurrencies as if they are not securities. Those days are over,” Avneri said in an interview with Cointelegraph on June 19. According to the exec, INX outlined this exact idea in its prospectus five years ago. “It’s like we had this crystal ball in our hands,” he added.
According to data from CoinGecko, Coinbase has as many as 241 cryptocurrencies listed on its platform at the time of writing, offering over 530 trading pairs. After managing to compromise on an asset freeze with U.S. regulators, rival exchange Binance.US still offers 154 cryptocurrencies for trading.
In contrast to Coinbase or Binance.US, INX has only listed five cryptocurrencies since it was founded in 2017. The listed coins include Bitcoin (BTC), Ether (ETH), USD Coin (USDC), Avalanche (AVA) and Litecoin (LTC), Avneri said.
“That’s it. A very limited crypto offering,” he stated, adding that INX carefully chooses which cryptocurrencies it lists for trading on its platform. He also stressed that INX should not be considered as a pure crypto company because the firm is mainly focused on digitized or tokenized securities.
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Avneri added that Bitcoin is “definitely not a security,” while there is no clear definition of Ether as such:
“There is no definition for Ethereum as a security just yet. I know there are a lot of discussions around it. I know there are a lot of opinions around it, and we are closely monitoring the news and we’ll continue to do so. So basically, Ethereum, for now, is listed on INX.”
INX will also find a way to list ETH on its platform in case it’s deemed security one day, Avneri told Cointelegraph.
The chief operating officer also stated that INX sees an opportunity in that thousands of cryptocurrencies now need to find a way to be converted into securities and listed on platforms like INX. “They need to find a way to be listed and to properly register with the SEC as securities,” Avneri stated, adding:
“I believe that this path will get clearer and clearer. And I think it’s it again, it puts the industry in a very unique, and I would say turning point or even a point of no return.”
The latest remarks by Avneri echo similar comments made by U.S. Securities and Exchange Commission chair Gary Gensler. In September 2022, Gensler argued that most cryptocurrencies are securities. Before becoming SEC chair, Gensler claimed that more than 70% of the crypto market is not securities, including Bitcoin, Ether, Litecoin, Bitcoin Cash and others.
As previously reported, INX positions itself as one of the first companies to conduct a security token offering approved by the U.S. SEC.
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