SEC Moves The Microscope Under NFT Conglomerate Yuga Labs
The SEC is shifting it’s sights towards NFTs, according to emerging reports hitting the wire on Tuesday. The U.S. regulator is apparently looking into whether to deem NFTs as securities and is exploring whether or not the sale of the NFTs violates federal law, including a specific look into Yuga Labs’ ApeCoin distribution.
Let’s review what we know in the early hours, and what sort of impact this latest news could have on the NFT market at large.
The SEC Goes NFT
The news was first let loose via Bloomberg’s crypto team and the signature Bloomberg Terminal. The U.S. Securities and Exchanges Commission (SEC) has long explored NFTs with little firm statements to result, but that could change pending the evolution of this latest news.
According to the Bloomberg report, the SEC is looking into whether Yuga Labs-issued assets are “more akin to stocks and should follow the same disclosure rules,” which could leave the NFT sphere with massive implications. However, no charges seem imminent, and Yuga Labs has expressed a vocal desire to work with regulators to come to amicable resolutions, with a Yuga rep telling Bloomberg:
“It’s well-known that policymakers and regulators have sought to learn more about the novel world of web3. We hope to partner with the rest of the industry and regulators to define and shape the burgeoning ecosystem… As a leader in the space, Yuga is committed to fully cooperating with any inquiries along the way.”
Times Are Changin’ Around Here
The SEC has not yet commented on the matter, and Yuga Labs’ ApeCoin has taken a hit upon the news. The report follows not long after vocal NFT community member and creator of Solana-based powerhouse project DeGods, Frank, teased “big changes” coming to NFTs; DeGods and other subsidiary projects have since shifted to a 0% royalty model, but could Frank have been teasing potential regulatory changes, too?
It’s impossible to say, but regulatory crackdowns on NFTs will undoubtedly dampen an already beaten down market in NFTs.Source