SEC Alleges NFT Sector for Selling Unregistered Securities

After cryptocurrency exchanges and crypto assets, the SEC has now alleged NFT sectors for securities law violations. SEC (Securities and Exchange Commission) has been keenly observing the crypto industry and has taken the rules and regulations seriously. Various exchanges have been brought to court for violating the laws and now for the first time ever SEC has alleged the NFT sector for selling unregistered securities.

In a press release, the SEC disclosed that Impact Theory based in Los Angeles launched an NFT project in 2021 named “Founder’s Key”. Founder’s Key project rolled out $30 million from several investors in the name of NFTs securities.  US SEC claimed that Founder’s Keys sold and offered investment contracts to different investors in the firm, violating the laws of securities carved by US regulators.

Impact Theory and Founder’s Project

According to the Impact Theory, in a Founder’s Project one can become the investor of the project if he invests in the company. They assured the investors that they would be able to gain maximum profits employing the NFT industry if Impact Theory works out in the coming time.  SEC claims that they have deceived the investors and violated the securities laws.

Also Read: Exploring the Long Term Challenges And Future Possibilities of the NFT Market

Impact Theory captivated the eyes of investors by comparing their vision with YouTube, Call of Duty and Disney and rolling out $30 million from different investors. SEC said that Impact Theory’s offered NFTs are basically security investment contracts and such securities are not registered yet. Therefore, the SEC has circled the NFT sector for the first time and charged the responsible person for selling unregistered securities through NFTs.

Issue Resolved

Tom Bilyeu, the CEO (Chief Executive Officer) of Impact Theory has announced that reached out to the SEC and settled the matter with the US SEC. Moreover, he showed his discontentment over the SEC’s performance or involvement as a hindrance in the growing digital world. He assured that the company is still optimistic and positive in transforming the world into a digital world.