in a statement that SC2 marketing the potential secondary market for the NFTs and implied that the qualifications of the creators and prominence of the actors would cause the NFTs to rise in value. The NFTs were configured so that SC2 received a 2.5% royalty on every secondary sale. There were at least secondary 10,000 sales of the NFTs worth more than $20 million, the SEC said.
SEC settled its first enforcement action involving PFP NFTs. SEC alleges each uniquely generated “Stoner Cat” itself to be a “crypto asset security in the form of a non-fungible token.” Mechanics of the offering were similar to most popular PFP projects. Some of my takeaways… /1Besides agreeing to the cease-and-desist order, SC2 will pay a civil penalty of $1 million. A Fair Fund will be created for disgorgement to reimburse “injured investors.