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

Hut 8 Wins Bid for Poolin's Texas Datacenter Sites

Hut 8 has successfully bid $140 million for two datacenter sites owned by the bankrupt mining company Poolin.

user avatarLucas Weissmann

Senate Banking Committee Democrats Request Hearing on Prediction Markets

Democratic members of the Senate Banking Committee request a public hearing to examine the growing issue of prediction markets and their regulatory implications.

user avatarFilippo Romano

Crypto Economic Activity Remains Strong Despite Market Downturn

Crypto economic activity has shown resilience despite a significant drop in market capitalization, indicating a shift in market dynamics.

user avatarEmily Carter

Visa's Research Highlights Trust as a Barrier to Stablecoin Adoption

Visa's research highlights that trust and fraud protection are essential for stablecoin adoption, with 36% of US respondents considering their use, especially with bank-level protections.

user avatarTomas Novak

Cardano's Onchain Governance Approves New Treasury Allocations

Cardano's governance system has approved a new round of treasury allocations aimed at infrastructure and ecosystem development.

user avatarKaterina Papadopoulou

Galaxy Invests $100 Million in Onchain Credit Infrastructure

Galaxy has invested $100 million in Sky Protocol's yield-bearing sUSDS, integrating it into its corporate treasury and allowing it as collateral for institutional trading.

user avatarMaya Lundqvist

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.