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08/30/2023
US Crypto Clampdown Continues as SEC Wins NFT Enforcement
PYMNTS
The year 2023 will forever be remembered as the year the U.S. Securities and Exchange Commission (SEC) went to war with crypto.
Determining who is truly trying to innovate a new and exciting financial category, versus who is a digital asset scam artist, remains among the central questions circling the crypto space.
This, as the agency on Monday (Aug. 28) charged Impact Theory, LLC, a media and entertainment company headquartered in Los Angeles, for holding an unregistered offering of crypto asset securities in the form of non-fungible tokens (NFTs), raising $30 million in the process.
Per the SEC’s order, the three tiers of NFTs offered and sold by Impact Theory were subject to U.S. securities laws and therefore should have been registered and regulated by the Commission.
“The order finds that the NFTs offered and sold to investors were investment contracts and therefore securities. Accordingly, Impact Theory violated the federal securities laws by offering and selling these crypto asset securities to the public in an unregistered offering that was not otherwise exempt from registration,” the agency wrote in a statement.
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