SEC Threats: From DeFi Land to the OpenSea

[TomPluz]

As the U.S. Securities and Exchange Commission (SEC) presses forward with efforts to regulate crypto, the agency’s enforcement threats have left a sprawling paper trail across the industry.

Whether it’s entities issuing coins or exchanges enabling them to trade, more market participants are waking up to a so-called Wells notice. On Wednesday, that kind of letter boiled to the surface of the NFT space, as the prominent marketplace OpenSea said it had received one too.

More of this development here.


Following the path SEC decided for itself under Gary Gensler, we might see more "attacks" from this government agency under the guise of doing its job as the industry's biggest regulator. After realizing that it failed miserably in regulating FTX which should have been its crowning glory if SEC did its job, it is now in the open safari preying on anyone or anything that comes its way. Of course, you might feel that SEC is just doing its job and that we might even be supporting it in this crusade to clean and correct the expanding cryptocurrency industry so it won't stop victimizing people via scams and frauds.

Are you on the SEC side on this matter?

[MrSpasybo]

Following the path SEC decided for itself under Gary Gensler, we might see more "attacks" from this government agency under the guise of doing its job as the industry's biggest regulator. After realizing that it failed miserably in regulating FTX which should have been its crowning glory if SEC did its job, it is now in the open safari preying on anyone or anything that comes its way. Of course, you might feel that SEC is just doing its job and that we might even be supporting it in this crusade to clean and correct the expanding cryptocurrency industry so it won't stop victimizing people via scams and frauds.

Are you on the SEC side on this matter?

I don't understand the SEC stance: if a picture is sold on the street, it's not a security, but if it's sold on a blockchain, it's considered a security. It seems like Gary Gensler wants to make a big splash before leaving the SEC chairmanship, and OpenSea + NFTs are the target of these accusations.

The SEC says it wants to protect investors in the crypto market but they can't do anything, the collapse of FTX shows the SEC poor management. The SEC is using American taxpayers' money to pursue unnecessary lawsuits, I think they will soon face failure when there is no basis to conclude that NFTs are securities. This is such a big issue that other assets in our collections or NFTs representing ownership of assets, such as car ownership on Avalanche, will also become securities and be regulated by the SEC in the future.

[yhiaali3]

What I see is that the SEC is holding the industry back so I don't expect anyone to side with it, especially its arrogant chairman Gary Gensler who seems to want to position himself as the master of the industry.

If the SEC was doing its real job of protecting the industry and users alike and preventing fraud, everyone would be with it, but what we see is that it is trying to hold companies back and impose more pressure and fines, nothing more.

No one is against the SEC cleaning up the field of fraudsters, but at the same time it should leave some space for companies to do their work in a more open environment that encourages more investment and development in the industry.

[Zed0X]

SEC might have a real case against the staking services offered by these crypto platforms but I don't know about asset listing. It's just strange to me how the latter could be charged when it's not yet determined that the coins and tokens (including NFTs) listed are securities.

[ABCbits]

So this time SEC is going overboard by trying to classify NFT and other tradable stuff as security. Do they really expect OpenSea to manually verify all submitted NFT on their platform? They could went bankrupt or limit the submission to few verified users.

[hugeblack]

Supporting defrauding efforts are good, but the regulating laws will not solve the problem. It is more like punches in the dark, it may affect your opponent, but it may cause great damage to all industry.
The best that can be done is giving licenses to good services and supporting them with investor awareness, then the money that will flow to the scammers will be minimal and their business will stop.

[Baofeng]

And probably this is what they are some voters who wanted the Trump administration to win, so that there are good chance that Trump will put a good candidate to be the SEC chair and not be so hard on crypto.

So this is another dumb move by Gensler and yeah, a threat to Defi and Opensea.

The question is who's next on the list of SEC? Who will get the next Wells notice?

[yhiaali3]

The question is who's next on the list of SEC? Who will get the next Wells notice?

There are many companies that are eligible to be on Gary Gensler's predatory table

All the companies that have grown significantly and inflated during the past period will be a target for Gary Gensler who is apparently trying to take advantage of his last days to get the largest amount of prey before he is fired by the new master of the White House as Trump stated if he wins.

I think everyone hopes this will happen soon.

[ABCbits]

Supporting defrauding efforts are good, but the regulating laws will not solve the problem. It is more like punches in the dark, it may affect your opponent, but it may cause great damage to all industry.

And it seems SEC doesn't care if their action affect legitimate business.

The question is who's next on the list of SEC? Who will get the next Wells notice?

At this rate, most major cryptocurrency company will receive that notice. After all, SEC already attack MetaMask for offering ETH staking using Lido and Rocket Pool which supposed to be decentralized or non-custodial.