The SEC’s First NFT Enforcement Action: SEC v. Impact Theory | Akin Gump Strauss Hauer & Feld LLP

Takeaways

— With the SEC engaged in high profile litigation across the country regarding the status of digital assets as securities, this case marks the first time the SEC has extended its jurisdictional reach further into the NFT space. This is not surprising, given remarks from Chair Gary Gensler last year, which indicated that the SEC’s broad reading of the Howey test could bring a numbers of NFTs into the SEC’s purview.

— The settlement shows that the SEC is paying close attention to statements and representations made to investors, including through social media sites, regarding how the NFT issuer intends to use proceeds from NFT sales. As a media and entertainment company, Impact Theory’s business may function differently than traditional NFT marketplaces, which could explain why the SEC identified several public statements made by the company….

Source: The SEC’s First NFT Enforcement Action: SEC v. Impact Theory | Akin Gump Strauss Hauer & Feld LLP