US filed class action lawsuit against Solana

California investor Mark Young accused key participants in the Solana ecosystem of illegally profitingfrom the native SOL token. According to the lawsuit, the coin is an unregistered security.

«The cornerstone of SOL's value isthe sum of the efforts of Solana Labs, Solana Foundation and [Anatoly] Yakovenko in the management and implementation of the Solana blockchain. They created the network and all the tokens in circulation, and also determined who would receive SOL securities and under what conditions,” the plaintiff said.

He described the asset as highly centralizeda cryptocurrency that profits insiders at the expense of retail traders. Among the beneficiaries, the investor also named venture capital firm Multicoin Capital, its partner Kyle Samani and the OTC division of FalconX.

Yang stated that he bought the tokens in late summer 2021. Since then, the asset has significantly lost in value.

According to the investor, the way SOL is created and sold is in line with the principles of the Howey test, which determines whether an asset is a security.

«Buyers who purchased securitiesSOL, contributed money or provided services to the Solana general enterprise. These investors have a reasonable expectation of profit based on the efforts of the promoters, Solana Labs and the Solana Foundation, to create a blockchain network,” the statement said.

The investor pointed out several preliminarysales of an asset before a public token sale. According to him, Multicoin, which invested heavily in Solana, brought “millions of dollars” worth of SOL to the retail market, making “great profits.” At the same time, the company «tirelessly» promoted the token, despite the technical problems of the blockchain, the plaintiff believes.

Multicoin's alleged large sale was through the FalconX platform, Yang believes.

He demanded recognition of SOL as a security, payment by the defendants of damages suffered by him and other investors in the asset, as well as «reasonable» reimbursement of legal costs.

Young is represented by the law firm Roche Freedman.

Recall that in June, the same company filed a class action lawsuit on behalf of investors LUNA and TerraUSD (UST) against Binance.US and CEO Brian Schroeder.

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