The US Securities and Exchange Commission (SEC), which came to the agenda with its investigations into cryptocurrency exchanges, this time took a hand in the NFT sector. The SEC opened an investigation into Impact Theory, a Los Angeles-based media company, for making NFT sales with an investment contract.
SEC on the agenda with its precedent setting decision for the US NFT market
Impact Theory, which came to the agenda with the NFT project called Founder’s Key, stated that if the project is successful, investors will profit from their purchases. The company, which offered the NFT project for sale with an investment contract, was caught on the SEC’s radar.
The company, which raised a total of $30 million from hundreds of investors, pioneered other companies to launch NFT projects as investment instruments. Stating that digital assets should not be marketed as investment instruments, SEC officials requested a $6.1 million fine for the investigation.
Donald Trump's recent "major announcement" was the release of a collection of non-fungible tokens (NFTs), which have sparked controversy and debate.
The company, which did not make any statement on the subject, agreed to pay the $6.1 million fine requested by the SEC. However, it created a “Fair Fund” to compensate investors who were negatively affected by the investment.
“We will conduct our business going forward with a good faith understanding of all applicable laws, rules and regulations and will make it clear that all of Impact Theory’s digital assets are useful collectibles in Borderless Entertainment’s exciting new environment and will strongly discourage people from treating our digital assets as anything other than what they are – useful collectibles. We will have more news on this in the coming weeks and months.”
