Cryptocurrency Insight
The SEC is turning its attention to NFTs, according to emerging reports released on Tuesday. The US regulator is apparently looking into whether to consider NFTs as securities and is exploring whether or not the sale of NFTs violates federal law, including a specific review of Yuga Labs’ distribution of ApeCoin.
Let’s review what we know in the early hours and what kind of impact this latest news could have on the wider NFT market.
The news was first reported via Bloomberg Crypto Team and the exclusive Bloomberg Terminal. The US Securities and Exchange Commission (SEC) has long explored NFTs with few firm statements, but that could change depending on how this latest news develops.
According to the Bloomberg report, the SEC is investigating whether assets issued by Yuga Labs are “more stock-like and must follow the same disclosure rules,” which could leave the NFT sphere with massive implications. However, no charges appear imminent, and Yuga Labs has expressed a desire to work with regulators to reach amicable resolutions, with a representative for Yuga telling Bloomberg:
“It is well known that policy makers and regulators have been looking to learn more about the new world of the web3. We look forward to partnering with the rest of the industry and regulators to define and shape the growing ecosystem…
ApeCoin (APE) took a notable hit after news that the SEC was looking into Yuga Labs activity. | Source: APE-USD on TradingView.com
The SEC has yet to comment on the matter, and Yuga Labs’ ApeCoin has been affected by the news. The report follows not long after vocal member of the NFT community and creator of the powerful Solana-based DeGods project, frank, sparked “big changes” coming to NFTs; Since then, DeGods and other spin-off projects have moved to a 0% royalty model, but could Frank also be triggering potential regulatory changes?
It’s impossible to say, but regulatory crackdowns on NFTs will undoubtedly dampen an already beaten NFT market.
Featured image from Pixabay, Charts from TradingView.comThe writer of this content is not associated or affiliated with any of the parties mentioned in this article. This is not financial advice.
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