SEC Closes Yuga Labs Probe
SEC Closes Yuga Labs Investigation
The Securities and Exchange Commission (SEC) has officially closed its investigation into Yuga Labs, the company behind the popular Bored Ape Yacht Club (BAYC) NFTs and ApeCoin. This concludes a probe that began in October 2022, examining whether these digital assets should be classified as securities.
Key Findings
- The SEC determined that BAYC NFTs and ApeCoin do not meet the criteria for securities under US law.
- This decision follows the application of the Howey Test, a legal framework used to define investment contracts.
- While the investigation lasted over two years, ApeCoin's price showed minimal immediate reaction to the news.
Yuga Labs, founded in 2021, achieved a $4 billion valuation by 2022, having raised $450 million in funding. Its BAYC collection boasts billions in trading volume, cementing its significant presence within the NFT space. The company celebrated the closure of the SEC's investigation as a major victory for the NFT ecosystem.
After 3+ years, the SEC has officially closed its investigation into Yuga Labs. This is a huge win for NFTs and all creators pushing our ecosystem forward. NFTs are not securities.
- Yuga Labs (@yugalabs)
This development carries significant implications for the NFT market, offering greater clarity on regulatory boundaries and potentially encouraging further innovation. However, it is crucial to remember that this decision relates to specific facts and circumstances of Yuga Labs. Future NFT projects and cryptocurrencies may still face SEC scrutiny. For guidance on regulatory compliance and secure development practices within the blockchain ecosystem, Codeum provides a range of services:
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