NFTREGULATION

SEC Commissioner suggests NFT regulation next year, crypto community predicts: NFTs with roadmaps are considered securities

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SEC Commissioner suggests NFT regulation next year, crypto community predicts: NFTs with roadmaps are considered securities

The U.S. Securities and Exchange Commission (SEC) revealed in a recent interview that regulatory agencies are eyeing the possibility of targeting NFTs in 2022. The crypto community believes that NFTs with roadmaps and continuous collaborations to bring additional value to the holders may be viewed as securities. In addition, Senate aide Corey Frayer will become an advisor on cryptocurrencies for the SEC.

No Need for New Regulatory Body

SEC Commissioner Hester Peirce, known as the "crypto mom" for her inclusive stance on the crypto space, has dismissed the idea of creating a new regulatory body for the industry, as suggested by companies like Coinbase to prevent stifling innovation.

She understands the concerns of crypto businesses but considers the idea unnecessary, stating that establishing a new regulatory body in Washington, D.C. would likely just result in members of existing agencies forming a new unit.

Peirce acknowledges that the SEC has not provided an effective regulatory framework for the crypto industry and that there have been minimal concrete regulatory developments so far. However, she emphasizes that the SEC is open to working with industry players to develop appropriate regulatory guidelines.

SEC Focuses on NFTs

According to Peirce, the SEC is focusing on the popular NFT market of 2021:

Given the broad scope of NFTs, some aspects may fall within our jurisdiction. This is an area that investors need to be cautious about. I think we will see further categorization of NFTs in 2022 as they are indeed valuable assets.

She anticipates more applications for NFTs in the future, such as ownership and governance, and advises holders to consider whether these applications comply with securities laws.

In response, crypto trader Cobie tweeted:

NFTs with roadmaps could potentially fall under the securities category, which may explain why Larva Labs, the issuer of digital collectibles, has not implemented regulatory strategies to create ongoing value for holders after the initial release.

Larva Labs, the creator of CryptoPunks, previously generated significant additional value and appeal for holders compared to mainstream collaborations like Bored Ape Yacht Club and Adidas, while remaining silent on future developments and copyright issues.

CryptoPunks holder and professional poker player Mike McDonald also concurred, stating that initially only the most astute individuals would recognize the securities issues with NFTs, but over time, more people will come to understand.

Cobie even shared a tweet from August this year where he already predicted that NFTs with roadmaps would be classified as securities.

Finally, in a press release on 12/30, the SEC announced that Senate aide Corey Frayer will serve as the SEC's cryptocurrency advisor. He will provide advice to SEC Chairman Gary Gensler on policy development and interagency coordination related to crypto asset regulation.