SEC Issues Wells Notice to NFT Platform OpenSea

In a shocking development, the US Securities and Exchange Commission (SEC) has issued a Wells Notice to the NFT platform OpenSea. Indeed, the notice assures that the agency intends to sue the marketplace while calling non-fungible tokens on the platform securities.

In a post to X (formerly Twitter), OpenSea noted they were “shocked that the SEC would make a move that threatens creators and artists,” after confirming the notice was received Wednesday. This marks another enforcement action taken by the SEC against the digital asset sector.

Also Read: SEC Lawsuit Against Kraken Crypto Exchange To Proceed to Trial

OpenSea Gets Wells Notice as SEC Calls NFTs Securities

The SEC has continued its stance against the crypto market. The agency has consistently opted for enforcement action against industry participants. Crypto firms like Ripple and Kraken have had to defend themselves against constant threats from the agency acting under the guise of regulation.

Now, they have targeted another Web3 market. Indeed, the SEC has issued a Wells Notice to NFT platform OpenSea. Moreover, the notice claims that these tokens are securities, driving the intention for enforcement action from the agency.

Former OpenSea Executive Nate Chastain Charged for NFT Insider Trading Scheme
Source: The Block

Also Read: SEC Pauses Solana SOL ETF Filings, Delays Approval Process

“Cryptocurrencies have long been in the crosshairs of the SEC,” OpenSea CEO Devin Finzer said in response to the notice. “But this is a move into uncharted territory. By targeting NFTs, the SEC would stifle innovation on an even broader scale,” he added. Furthermore, noting that digital art should not face the same kind of regulation as “collateralized debt obligations.”

Additionally, Finzer said the NFT actions put “hundreds of thousands of online artists and creatives,” at risk. However, he noted the platform’s intention to fight the allegations. Moreover, he said the firm is “pledging [$5 million] to help cover legal fees for NFT creators and devs that receive a Wells notice.”

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