SEC Investigating Bored Ape NFT Creator Over Unregistered Asset Offering
The U.S. Securities and Exchange Commission (SEC) has launched a probe into Yuga Labs, the entity behind the popular NFT collection Bored Ape Yacht Club, over the sale of its NFTs and digital tokens.
The regulatory agency is investigating whether some Yuga Labs NFTs are akin to stocks and should follow the same disclosure rules, Bloomberg reported, citing someone familiar with the matter who asked not to be named because the probe is private.
Furthermore, the SEC is examining Yuga Lab's distribution of ApeCoin, the Bored Ape Yacht Club-affiliated cryptocurrency that is poised to become the native currency of Otherside, a metaverse game from Yuga Labs.
“It’s well-known that policymakers and regulators have sought to learn more about the novel world of web3. We hope to partner with the rest of the industry and regulators to define and shape the burgeoning ecosystem,” Yuga Labs said in response.
The Bloomberg report clarified that the SEC has not accused Yuga Labs of any wrongdoing and that the opening of a probe doesn’t mean the agency will sue the company.
Launched in 2021, Yuga Labs has evolved to become one of the biggest players in the crypto and Web3 industry. Aside from BAYC, Yuga's other NFT collections have also gained some traction, which includes BAYC's spin-off Mutant Ape Yacht Club and Otherside NFTs.
SEC Chair Gary Gensler has long been investigating the crypto market to make sure it adheres to the regulations. At times, he even claimed that some crypto assets have characteristics of securities, which then requires them to register with the agency before token offerings.
The SEC's biggest case against the crypto market relates to Ripple's XRP. The agency argues that Ripple raised $1.3 billion by selling XRP
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