On May 19, 2025, SEC Commissioner Hester Peirce clarified that many NFTs are not considered securities, addressing key regulatory concerns among crypto participants.
NFTs with Royalties Not Automatically Securities
On May 19, 2025, Hester Peirce stated that NFTs with a creator royalty mechanism do not automatically classify as securities. This announcement aims to clarify the regulatory landscape for the burgeoning NFT market. As Peirce stated, "NFTs with a creator royalty mechanism do not necessarily make the tokens securities".
Decreased Regulatory Risk Sparks NFT Market Interest
The SEC's announcement has reduced perceived regulatory risks, likely encouraging increased participation in NFT markets. This development could drive more venture capital into NFT projects. By decreasing uncertainty, the statement may accelerate the growth of NFT marketplaces, with Ethereum and related platform tokens expected to see positive trading impacts.
SEC Clarification Could Set Regulatory Precedent
Past regulatory ambiguity led to stagnation in the NFT sector. Peirce’s prior statements in February 2025 also questioned traditional crypto regulations, highlighting the unique nature of NFTs. Experts suggest that the clarification could set a precedent for future policy decisions, supporting the NFT industry's development.
The SEC's clarifications may significantly impact the future of the NFT market by reducing regulatory risks and supporting the development of new projects.
