According to a number of reports, the SEC has opened an investigation into possible violations of securities laws on the part of Yuga Labs, the company that developed the BAYC NFT collection. On the other hand, the SEC has not yet presented its position on Non-Fungible Tokens (NFTs).
Consequently, those involved in the creation of NFT projects experience feelings of unease and exasperation. However, the Securities and Exchange Commission Commissioner Hester Peirce, who is sometimes referred to as the "Crypto Mom," offered her perspective on the issue.
Peirce stated that the SEC has not yet provided any clarity on the topic of NFTs. But she also stated, "there is a vast complexity, and in these instances where there is such a level of ambiguity, it is necessary that people be extra careful." It's not the best state for rules and regulations.
Pierce's Anti-SEC Stance
Peirce is one of the five elected commissioners of the SEC, and he has long been opposed to the way the agency regulates cryptocurrencies.
Peirce stated, "I have on numerous occasions during the past two years. Creating and enforcing laws is the responsibility of a good government. Enforcement actions are unable to be taken until after individuals have broken the law. You should try to stay away from utilizing enforcement actions to educate individuals about the law. Before everything else, there ought to be certain ground rules."
Hester Peirce is of the opinion that the SEC took the complete opposite approach in reference to NFTs. Peirce also believes that the SEC could provide more clarity for NFT inventors as they manage the mass acceptance of NFTs if it were given the opportunity.
According to her statement, "our agency could do that whenever we wanted. In addition to that, the appropriate systems are already in place. We can also work on an exempt order, which would state that "if you meet these requirements, you are protected from prosecution under the laws of the SEC."
We also have the ability to draft a letter that states, "if you engage in any of these actions, we are not likely to take any enforcement action against you." She went on to claim that "we could have done it whenever we wanted, but we are not doing it."
At the same time, Peirce noted that there are some qualities of securities that those who are creating NFTs should avoid at all costs. Peirce's advice may be found here. If they didn't change their behavior, they'd be in violation of the criteria for securities. Having said that, she went on to say that the SEC has to revise these standards in regard to NFTs.