The cryptocurrency space was swathed in a sea of red Saturday morning, as most altcoins pulled back sharply.

What Happened: The sharp pullback came amid the SEC’s lawsuits against cryptocurrency exchanges Binance and Coinbase Global, Inc. (NASDAQ:COIN). After flatlining on Friday, most altcoins began a sharp retreat in the early hours of Saturday.

Polygon (CRYPTO: MATIC) led the slide, with the DeFi token slumping 27.75%. Conflux (CRYPTO: CFX), the native token of Conflux Network, and EOS (CRYPTO: EOS) plunged about 25%.

Also racking up steep losses were Apecoin (CRYPTO: APE) (down over 24%), Solana (CRYPTO: SOL) (down over 22%), and Axie Infinity (CRYPTO: AXS) (also down over 22%).

Meme cryptos weren’t spared either. Dogecoin (CRYPTO: DOGE) and Shiba Inu (CRYPTO: SHIB) fell over 15% and 16% respectively.

Bitcoin (CRYPTO: BTC) and Ethereum (CRYPTO: ETC) were down a more modest 3.54% and 5.54% respectively, according to Benzinga Pro data.

Digital tokens resisting a sell-off included dollar-linked Stablecoins such as Gemini Dollar (CRYPTO: GUSD), Pax Dollar (CRYPTO: USDP), Tether (CRYPTO: USDT), and USD Coin (CRYPTO: USDC).

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Why It’s Important: Blockchain tokens appeared to react to the SEC’s decision to label 13 tokens as securities in its lawsuit. The label could bring those 13 tokens under stricter regulations that apply to securities.

On Saturday, Twitter users began speculation about a large unnamed crypto fund possibly liquidating its holdings. “Feels like a large entity emptying their books, likely related to the looming regulatory headaches in the U.S,” one said.

Crypto-tracked futures showed $300 million worth of liquidations early Saturday, Coindesk reported, citing data from Coinglass. This was more than the nine-month record liquidation figures from earlier this week, it added.

Liquidation occurs when a trader’s position is forcibly closed because there are not enough funds to cover an ongoing loss.

Related Link: A Look At Bitcoin, Ethereum And Dogecoin Heading Into The Weekend, Ahead Of Fed Rate Decision

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