According to a lawsuit filed in the U.S. District Court for the Northern District of California, cryptocurrency Solana (CRYPTO: SOL) is an unregistered security.
The lawsuit also accused Solana Labs, Solana Foundation, Solana Labs CEO Anatoly Yakovenko, Multicoin Capital Management LLC, Kyle Samani, and Falconx LLC of making illegal profits.
It also says the defendants deliberately made misleading statements regarding Solana’s total circulating supply and decentralized nature.
According to the report, the plaintiff mentioned in the lawsuit that Multicoin Capital Management and Samani promoted SOL securities after purchasing them for $0.40 in 2019.
Also Read: Here's What Caused The Solana Blockchain Halt
Later, they offloaded a considerable amount of SOL securities to retail investors using OTC trading desks such as Falconx.
In terms of compensation, the plaintiff is seeking recompense for all damages sustained due to the defendants’ wrongdoing and a declaration that Solana is a security and that the defendants’ unregistered sales of SOL securities violated applicable laws.
The lawsuit was filed by Roche Freedman LLP and Schneider Wallace Cottrell Konecky.
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