OpenSea users claim NFTs are securities in proposed class suit

OpenSea users claim NFTs are securities in proposed class suit

user avatar

by Giorgi Kostiuk

2 years ago

Made with AI

  1. Allegations against OpenSea
  2. Precedents and SEC actions
  3. Comments and next steps

    4. Two OpenSea users have filed a class-action lawsuit against the NFT marketplace, claiming that the sold NFTs are illegal unregistered securities.

    Allegations against OpenSea

    Anthony Shnayderman and Itai Bronshtein claimed that the NFTs they purchased on OpenSea, including those from the once high-priced Bored Ape Yacht Club collection, are worthless “due to their illegal nature.” They pointed to OpenSea’s disclosure of a Wells notice from the Securities and Exchange Commission (SEC) last month, which they claimed suggests that OpenSea may be found liable for facilitating the exchange of unregistered securities.

    Precedents and SEC actions

    The suit also points to successful SEC actions against NFT projects Stoner Cats 2 and Impact Theory, where the regulator said the NFTs were unregistered securities sales. Shnayderman and Bronshtein argued that the Howey test, which defines securities, shows that the NFTs they bought on OpenSea were investment contracts under US securities laws, as they were an investment in a common enterprise with an expectation of profits from others' efforts.

    Comments and next steps

    In an emailed statement, the plaintiffs’ counsel Adam Moskowitz stated, “With today’s ever-changing regulation, there should be a process to sell NFTs in a well-regulated environment.” Moskowitz added that they look forward to working with OpenSea to structure the best avenue and future process for both consumers and the crypto industry. OpenSea did not immediately respond to a request for comment.

    Further developments will show how this lawsuit and ongoing SEC actions may impact the NFT market and its regulation in the future.

Tier I

Sector: #18291

Sealed Hiding Place Room

Resource Cache

Resource Cache

Tier I

Requires 25% Tier Progress to Claim
Meme Cache

Meme Cache

Tier I

Requires 50% Tier Progress to Claim
Equipment Cache

Equipment Cache

Tier I

Requires 75% Tier Progress to Claim

After collecting, hiding places will be stored in your inventory and can be opened with Keys.

Other news

MEXC Launches Initiatives to Enhance Access to Financial Markets

MEXC has launched several initiatives, including the Trade Wall Street, Without Walls campaign, to enhance access to traditional financial markets.

user avatarRajesh Kumar

MEXC Introduces Stock Trading Handbook for Crypto Traders

MEXC has launched the Stock Trading Handbook to assist crypto traders in transitioning to the stock market as part of its Opportunity Compass initiative.

user avatarLucas Weissmann

KalshiEX Seeks Approval for Perpetual Security Futures

KalshiEX has filed a proposal with the SEC to introduce perpetual security futures linked to 58 stocks and ETFs.

user avatarFilippo Romano

US Dollar Strengthens Its Dominance in Forex Market

The US dollar's share in the forex market has increased to 89%, defying challenges from rival currencies.

user avatarEmily Carter

Cipher Mining Expands into High-Performance Computing and AI Infrastructure

Cipher Mining is leveraging its mining business assets to enter the high-performance computing and AI infrastructure market.

user avatarTomas Novak

REX Shares Launches TREX 2X Long Strive Daily Target ETF

REX Shares has launched the TREX 2X Long Strive Daily Target ETF, aiming to deliver 200% of the daily performance of Strive Asset Management shares influenced by its Bitcoin treasury.

user avatarKaterina Papadopoulou

Important disclaimer: The information presented on the Dapp.Expert portal is intended solely for informational purposes and does not constitute an investment recommendation or a guide to action in the field of cryptocurrencies. The Dapp.Expert team is not responsible for any potential losses or missed profits associated with the use of materials published on the site. Before making investment decisions in cryptocurrencies, we recommend consulting a qualified financial advisor.