Loeb Advanced Media & Technology partner Mercedes Tunstall spoke to the Daily Report about how the growing popularity of digital assets, nonfungible tokens (NFTs), is creating a boom in work and opportunities for lawyers in the cryptocurrency industry.
Mercedes told the publication that lawyers who are interested in NFTs should be on the lookout for potential securities litigation. She said that while the U.S. Securities and Exchange Commission has not identified NFTs as securities in most cases, if NFTs are issued and discussed “in a manner that is consistent with a security, then it could be a security.”
Mercedes provided an example, mentioning an ongoing class action lawsuit brought against NBA Top Shot Moments claiming that certain NFTs the company is selling – video footage depicting highlights from NBA games – are unregulated securities “promoted, offered and sold” in violation of federal securities laws.
“That’s something that we’re watching really closely,” Mercedes said. ”If that decision goes in favor of the plaintiff, then that basically points to having to be very, very, very careful about any statements someone issuing NFTs makes about their value. It would also mean that NFT marketplaces would have to be really careful about restricting the movements of NFTs on and off their marketplace.”
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