NFT Sector is Facing Investigation in US for Illegal Crypto Token Offers
NFT sector in the US will face an inquiry by US authority for illegal Crypto Tokens offers.
The officials of the authority have sent many times the subpoena to the agency demanding crypto tokens offering.
Highlights
- The authority SEC has a particular interest in investigating fractional NFTs.
- All the NFTs will be considered as security after passing the Howey test.
- The fractional NFTs were also be warned by the previous SEC commissioner.
The Investigation of NFTs is being carried out by the US-based authority called the US Securities and Exchange Commission (SEC) and the team for the investigation will be led by the chairman of the agency Grey Gensler. He including his team will investigate the NFTs including the creators and marketplaces for security violations.
The attorney of agency SEC has sent many summonses to the different NFTs stakeholders over the past few months with the main objective of demanding the details of the potentially illegal token offerings. The agency including all the platforms of NFT, the fractional NFTs has focused on the top priorities.
The rule book of the authority SEC says if NFTs or any crypto assets come under the securities if it passes the test known as Howey test which is said to be used by the American Watchdog to determine if they are involved in the investment contract in the transaction or not.
As Bloomberg and other sources acquainted with the matter claims that the authority SEC has organized the investigation are being utilized to raise money like traditional securities. The reports also reveal that in the past few months SEC’s enforcement unit has sent many notices as a summons to the NFTs creators for demanding information to some specific NFTs and some other token offerings.
Sometime before in December the Commissioner at SEC Hester Peirce told in an interview that SEC’s interest is looking deeper into the NFTs sector. The commissioner is also known as the crypto Mom. His statement can be read as “given the breadth of the NFT landscape, certain pieces of it might fall within our jurisdiction. People need to be thinking about potential places where NFTs might run into the securities regulatory regime.”
