United

Impact

Million

<![CDATA[<figure class="image"><img src="https://cimg.co/news/123603/326807/us-sec-1.jpg" alt="" srcset="https://cimg.co/news/123603/326807/responsive-images/us-sec-1___media_library_original_1200_800.jpg 1200w, https://cimg.co/news/123603/326807/responsive-images/us-sec-1___media_library_original_900_600.jpg 900w, https://cimg.co/news/123603/326807/responsive-images/us-sec-1___media_library_original_720_480.jpg 720w, https://cimg.co/news/123603/326807/responsive-images/us-sec-1___media_library_original_600_400.jpg 600w, https://cimg.co/news/123603/326807/responsive-images/us-sec-1___media_library_original_300_200.jpg 300w" sizes="100vw" width="1200" class="content-img"><figcaption>Source: AdobeStock / Andriy Blokhin</figcaption></figure>In a display of dissent within the United States Securities and Exchange Commission (SEC), Commissioners <a href="https://www.sec.gov/news/statement/peirce-uyeda-statement-nft-082823">Hester Peirce and Mark T. Uyeda</a> have expressed their reservations regarding the agency's first NFT enforcement action against the media firm Impact Theory.&nbsp;The move marks the SEC's first foray into regulating the non-fungible token (NFT) market.As reported earlier, the <a href="https://cryptonews.com/news/sec-charges-impact-theory-over-nft-sales.htm">US SEC has charged Impact Theory</a> over its NFT launch, which the agency deemed an unregistered securities offering.&nbsp;Impact Theory had raised approximately $30 million through the sale of NFTs, claiming the tokens represented a stake in its ambitious entertainment venture likened to "building the next Disney."<figure class="media"><oembed url="https://twitter.com/HesterPeirce/status/1696207571567149147"></oembed></figure><h2 style="text-align:justify;" id="sec-commissioners-disagree-with-agencys-action">SEC Commissioners Disagree with Agency&rsquo;s Action</h2>Peirce and Uyeda have argued that the <a href="https://cryptonews.com/guides/nft/">NFTs</a> in question should not be subjected to the Howey analysis, a test traditionally used to determine whether a transaction qualifies as an investment contract.&nbsp;The Commissioners assert that categorizing NFTs as investment contracts oversimplifies the diverse rights that NFTs can confer upon digital and physical assets.&nbsp;They further argued that the complexities inherent in the NFT landscape necessitate careful consideration before enforcement actions are taken, especially since this case could set a precedent for future NFT offerings.The Commissioners' statement raises fundamental questions about the suitability of applying existing securities regulations to the evolving NFT market.&nbsp;With NFTs ranging in their utility from art and collectibles to access tokens and more, the regulatory landscape becomes challenging to navigate.&nbsp;Peirce and Uyeda's concerns extend to the potential consequences of this enforcement action, specifically whether it implies a blanket classification of NFTs as securities offerings and the potential impact on creators' ability to earn royalties from secondary market transactions.<h2 style="text-align:justify;" id="impact-theory-agree-to-pay-6-1-million-in-penalty">Impact Theory Agree to Pay $6.1 Million in Penalty&nbsp;</h2>As part of the settlement reached with the SEC, Impact Theory agreed to a cease-and-desist order, a penalty of over $6.1 million, and the establishment of a Fair Fund to reimburse investors.&nbsp;The media firm also committed to relinquishing any future royalties from secondary market NFT transactions, a decision that could have major impact on the NFT creator community.The dissenting viewpoint of Commissioners Peirce and Uyeda underscores the intricate regulatory challenges surrounding the burgeoning NFT ecosystem.&nbsp;After declaring over 60 plus <a href="https://cryptonews.com/news/coingecko-launches-index-for-crypto-tokens-alleged-as-sec-securities-valued-at-91-billion.htm">cryptocurrencies as securities</a>, the US SEC seems to be setting its eyes on the NFTs.&nbsp;
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SEC Commissioners Dissent Against Agency's First NFT Enforcement Action

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