In this week’s newsletter, read about how a trader acquired a high-end piece from the CryptoPunks non-fungible token (NFT) collection for only 10 Ether (ETH) and how crypto exchange Coinbase is supporting NFTs with a legal defense fund. Check out how two United States Securities and Exchange Commission commissioners reacted when the government agency fined a restaurant $750,000 for selling NFTs.
In other news, the blockchain advocacy organization Digital Chamber supported a newly introduced bill to properly define NFTs and exempt some from securities laws. Meanwhile, the CEO of NFT collection Pudgy Penguins described the SEC’s actions against the NFT space as nonsense.
Trader’s acquisition of $1.5 million CryptoPunk for $23,000 raises eyebrows
A crypto trader found a way to take ownership of a fractionalized CryptoPunk NFT by triggering a buyout feature in the smart contracts of a defunct platform that splits NFT ownership. The NFT collector proposed a buyout of CryptoPunk #2386 for only 10 ETH on Aug. 28.
The smart contract allowed NFT shareholders to counter the proposed buyout for 14 days. While some attempted to challenge the buyout, the trader ultimately completed the ownership transfer.
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Coinbase’s “Stand With Crypto” creates NFT legal defense fund
Crypto exchange Coinbase’s crypto advocacy initiative, “Stand with Crypto,” has now branched out into NFTs. On Sept. 13, the Coinbase launched a Creator Legal Defense Fund worth $6 million, backed by OpenSea and Andreessen Horowitz.
With the new initiative, NFT creators targeted by the SEC can apply for representation. The Stand With Crypto account on X said that with the fund, creators can oppose “misguided actions from the SEC.”
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Coinbase’s “Stand With Crypto” creates NFT legal defense fund
Crypto exchange Coinbase’s crypto advocacy initiative, “Stand with Crypto,” has now branched out into NFTs. On Sept. 13, Coinbase launched its Creator Legal Defense Fund, worth $6 million and backed by OpenSea and Andreessen Horowitz.
With the new initiative, NFT creators targeted by the SEC can apply for representation. Stand With Crypto said on X that with the fund, creators can oppose “misguided actions from the SEC.”
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SEC commissioners slam agency after $750,000 Flyfish Club NFT settlement
The SEC recently imposed a $750,000 penalty on a restaurant for selling NFTs. In a Sept. 16 cease-and-desist order, the SEC said Flyfish Club conducted an offering of unregistered securities through its NFT sale.
SEC Commissioners Hester Peirce and Mark Uyeda criticized the agency’s move to fine Flyfish Club for selling the NFTs. The two government officials argued the NFTs were just another means of selling memberships.
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Digital Chamber urges US crypto users to support new NFT bill
With the SEC continuing its regulation-by-enforcement approach, blockchain advocacy organization Digital Chamber has called on the crypto space to support a bill to protect NFTs. The New Frontiers in Technology Act (NFT Act), introduced by US Representative William Timmons, aims to address NFTs’ regulatory woes.
Digital Chamber urged Americans to call their representatives and urge them to help the industry flourish without securities regulations being misapplied.
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Pudgy Penguins CEO unfazed by SEC actions against the NFT sector
At the Token2049 event in Singapore, Pudgy Penguins CEO Luca Schnetzler said he wasn’t too worried about the SEC’s crackdown on NFTs. The executive believes that the SEC’s actions are “nonsense” and described it as a “nothing burger.”
The Pudgy Penguins executive believes that if the SEC goes after OpenSea, it must also go against other organizations that dived into NFTs, including Nike, Pokemon and Sotheby’s.
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Thanks for reading this digest of the week’s most notable developments in the NFT space. Come again next Wednesday for more reports and insights into this actively evolving space.
