As a seasoned crypto investor with a keen eye for market trends and regulatory developments, I can’t help but feel a tinge of concern over the recent Wells notice served to CyberKongz by the SEC. Having navigated through the crypto landscape for years, I’ve learned that regulatory clarity is as essential as blockchain technology itself in fostering growth and trust.
The potential for gaming tokens might face a challenge following the US securities regulator’s issuance of a Wells notice to the NFT platform, CyberKongz.
According to CyberKongz’s recent post on December 16th, the Securities and Exchange Commission (SEC) has expressed concerns that an ERC-20 token used within a blockchain game must be registered as a security before it can be issued.
In simpler terms, CyberKongz stated that such a discussion could significantly affect the Web3 gaming sector. They further mentioned that these points would help fortify their position within the broader digital landscape.
A Wells Notice, issued by the Securities and Exchange Commission (SEC), serves as a formal communication to an organization, indicating that the regulatory body might take enforcement action following a preliminary probe. In this case, CyberKongz has been granted a 30-day window to submit their response.
One of the concerns raised by the SEC regarding CyberKongz centered around their distribution of Genesis Kongz NFTs in April 2021. CyberKongz, however, emphasized that this event was more about moving contracts rather than conducting a primary sale.
As an analyst, I’ve come to understand that CyberKongz primarily self-funded its operations, not seeking external capital, and has maintained a relatively modest treasury. Since our initial encounter with the Securities and Exchange Commission (SEC) about two years back, we’ve been quietly navigating the challenges that followed, keeping our struggles largely under wraps.
CyberKongz implied that the enforcement action by the Biden administration was a last-minute effort aimed at impeding progress within the industry. Furthermore, they mentioned this move could potentially hinder the industry’s advancement.
“We hope that the new administration puts an end to this unjustness on our industry, but until then we will fight for NFT projects on all chains.”
As a researcher, I am grateful to have received encouraging messages from one of the founding members of Axie Infinity, Jihoz Zirlin. He expresses his confidence that the incoming leadership will bring an end to the oppression faced by our community.
CyberKongz NFTs are digital characters, both 2D and 3D, created randomly for use in gaming platforms like “play & collect” and “adventure races,” which operate on the Ronin blockchain.
Despite the Wells notice, the value of a CyberKongz NFT hasn’t been affected and has actually increased by 11.7% over the past 24 hours, reaching an average floor price of 6.69 Ether (ETH), which equates to approximately $26,900 as per CoinGecko’s latest data.
CryptoMoon reached out to CyberKongz for comment but didn’t receive an immediate response.
Recently, the American Securities and Exchange Commission (SEC) issued a warning, known as a Wells notice, to the Australian-based company, Immutable, on November 1st. Since then, they haven’t announced any ensuing enforcement actions.
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2024-12-17 02:29