11 months ago
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The United States Securities and Exchange Commission (SEC) has lodged a lawsuit against Binance, the world’s largest cryptocurrency speech by trading volumes, pressing 13 charges, including 1 wherever they impeach the ramp of allegedly allowing the trading of concern contracts.
The regulator claims that these assets are “crypto securities.” Some of the securities listed by the regulator arsenic examples see metaverse tokens of The SandBox, SAND, and Decentraland’s MANA.
SEC Claims MANA And SAND Are Securities
Supporters assertion the metaverse is inactive nascent but could beryllium transformative successful the years ahead. However, pursuing the SEC suit against Binance, 1 of the apical exchanges supporting trading of MANA and SAND, questions are opening to look arsenic to whether metaverse tokens are securities, arsenic the SEC alleges.
The SEC claims that Binance has continued supporting crypto plus securities trading contempt the regulator issuing enforcement actions against those projects. They mention the continued trading of TRX, the autochthonal currency of Tron, and REP, issued by Augur, arsenic examples of Binance’s ignoring their action.
Their comments and citing tokens of fashionable metaverse platforms arsenic examples could besides adversely interaction liquidity arsenic different exchanges mightiness beryllium reluctant to database them.
The lawsuit filed by the SEC astatine the United States District Court for the District of Columbia is yet to beryllium determined. Even so, that projects engaged successful the metaverse find themselves successful the crosshairs of regulators could beryllium a blow, perchance slowing down the much-needed improvement arsenic funds could beryllium diverted to wage ineligible fees.
Challenges Slowing Metaverse Adoption
Presently, the metaverse is facing respective challenges, slowing down adoption. For example, the effects of 2022’s crypto wintertime are inactive being felt. Metaverse tokens’ prices are inactive down implicit 80%, connected average, from 2021 peaks.
To illustrate, astatine $0.47, arsenic per data from CoinMarketCap, MANA is down 90% from 2021 highs of $5.2. SAND is besides down by implicit 90%, dropping from arsenic precocious arsenic $7.4 to $0.53 arsenic of penning connected June 5.
Dropping metaverse token prices coincided with a accelerated contraction successful non-fungible token (NFT) activity. NFTs are captious for the metaverse arsenic assets. They let items to beryllium represented arsenic unsocial transferable tokens.
Beyond terms contraction, dApps supporting the metaverse are mostly incompatible, meaning assets successful antithetic virtual worlds cannot beryllium ported to different ecosystems.
Adopters person besides noted that regulations person failed to drawback up, meaning developers person nary guidelines connected releasing assets that mightiness comply with laid down rules arsenic inferior tokens.
Moreover, hardware limitations are proving to beryllium a challenge. Available hardware is not a cleanable acceptable for existing metaverses. Virtual Reality (VR) glasses that costly and bulky, portion Augmented Reality (AR) glasses are being developed.
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