Private NFTs should not be classified as securities, crypto community reacts

Private NFTs should not be classified as securities, crypto community reacts

Various NFT fans and lawyers have openly opposed a U.S. court magistrate who claimed that NFTs might be categorized as securities.

NBA Top Shot NFTs judge ruling

According to a recent decision made by a U.S. federal magistrate, NBA Top Shot non-fungible tokens (NFTs) might well be classified as securities. The ruling could affect the NFT market. Investors contended that since NFTs were sold to buyers with the intention of turning a profit, they complied with the legal definition of securities.

A Twitter user under the pseudonym @notthreadguy outspokenly inquired, “How can my NFTs be classified as securities if I can’t even damp them for $0?”

Lawyers dispute claims

Jake Cherinsky, a lawyer and Chief Policy Officer at Blockchain Association, stated that classifying NFTs as securities due to some vague similarities is false. The lawyer was among the many lawyers who reiterated that judge Victor Marreo’s denial of the motion didn’t imply that a final ruling had been made on the suit but that it was only “plausible”

Jake clarified previous rumors, saying the judge reached no conclusions. He highlighted how the judge permitted the case beyond a dismissal motion because the securities allegations were at least “plausible.” 

Derrick Hammer, a Web 2.0/Web 3.0 developer, in reply to Jake, referred to an earlier text late last year where he claimed the securities law requires amending to match current times.

SEC is trying to extend its reach

In another hilarious post, similar to the popular “change my mind” meme, is likened to Gary Gensler, SEC Chairperson. The meme stated, “Everything is a security, change my mind.”

Perianne Boring, founder and CEO of the Chamber of Digital Commerce, said the case represents a subtle yet substantial and extraordinary effort to broaden the SEC’s jurisdictional reach and threatens the viability of the U.S. marketplace for digital assets.

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