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SEC charges Impact Theory for unregistered offering of NFTs

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Re: SEC charges Impact Theory for unregistered offering of NFTs

#31

Post by ramijames »

jermaustin1 wrote: post #7

The concept of NFTs stored on a distributed ledger makes sense to me especially for the shitty games that sell skins. The idea they have some sort of value and can be considered a security, doesn't really. It is no different than the current in-game marketplaces that sell/resell skins from whatever game has skins this week. At what point does a thing you buy or sell become a security? Are baseball cards a security? S…

That's exactly what we've been trying to build at Ultra.io

The push back from gamers has been non-stop and intense. I don't get it. They are willing to buy digital assets which can't be resold on an open market. They are not willing to buy digital assets that can.

It's kind of bonkers.

Re: SEC charges Impact Theory for unregistered offering of NFTs

#32

Post by junofan »

evilantnie wrote: post #20
jermaustin1 wrote: post #7

The concept of NFTs stored on a distributed ledger makes sense to me especially for the shitty games that sell skins. The idea they have some sort of value and can be considered a security, doesn't really. It is no different than the current in-game marketplaces that sell/resell skins from whatever game has skins this week. At what point does a thing you buy or sell become a security? Are baseball cards a security? S…

From what I'm reading here, the company misled "investors" by attaching the NFT to ownership in the company, which would be considered a security. "The order finds that Impact Theory encouraged potential investors to view the purchase of a Founder’s Key as an investment into the business, stating that investors would profit from their purchases if Impact Theory was successful in its efforts." When I purchase a baseba…

You must not be buying baseball cards in 2023. It’s gotten crazy.

Re: SEC charges Impact Theory for unregistered offering of NFTs

#33

Post by post-it »

playday wrote: post #25
evilantnie wrote: post #20

Earlier quoted context omitted.

From what I'm reading here, the company misled "investors" by attaching the NFT to ownership in the company, which would be considered a security. "The order finds that Impact Theory encouraged potential investors to view the purchase of a Founder’s Key as an investment into the business, stating that investors would profit from their purchases if Impact Theory was successful in its efforts." When I purchase a baseba…

With baseball cards, You have an expectation that the MLB will continue to promote and develop Baseball as a top sport. You purchased an illegal security.

You'd best file an amicus brief with your analysis.

Re: SEC charges Impact Theory for unregistered offering of NFTs

#34

Post by taeric »

burnerz27M wrote: post #29
playday wrote: post #25

Earlier quoted context omitted.

With baseball cards, You have an expectation that the MLB will continue to promote and develop Baseball as a top sport. You purchased an illegal security.

Wouldn't the inverse be true - baseball cards become much more rare if Baseball itself ceases to exist as a going concern.

Rare things are not automatically valuable. I still have "dragon dice" and an original deck of cards from an old lord of the rings game. Basically worthless.

Re: SEC charges Impact Theory for unregistered offering of NFTs

#35

Post by playday »

When you buy a restaurant lunch, you are expecting to increase your work income via the efforts of the cooks. And you clearly invested money since you pay for the lunch before you ate it. That’s all 3 prongs if the Howey test.

Why isn’t the SEC enforcing securities laws against lunch fraud? Lunches must publish their financial statements so lunch buyers can make informed decisions! Personally I am angry that restaurants don’t publish the information I need to make an informed decision regarding my investment. What if they go bankrupt after I paid for my lunch and before they deliver it?

Re: SEC charges Impact Theory for unregistered offering of NFTs

#36

Post by boringg »

burnerz27M wrote: post #29
playday wrote: post #25

Earlier quoted context omitted.

With baseball cards, You have an expectation that the MLB will continue to promote and develop Baseball as a top sport. You purchased an illegal security.

Wouldn't the inverse be true - baseball cards become much more rare if Baseball itself ceases to exist as a going concern.

Yes, baseball cards would become incredibly valuable (at least the rare ones).

Re: SEC charges Impact Theory for unregistered offering of NFTs

#37

Post by jkingsman »

playday wrote: post #35

When you buy a restaurant lunch, you are expecting to increase your work income via the efforts of the cooks. And you clearly invested money since you pay for the lunch before you ate it. That’s all 3 prongs if the Howey test. Why isn’t the SEC enforcing securities laws against lunch fraud? Lunches must publish their financial statements so lunch buyers can make informed decisions! Personally I am angry that restaura…

If crypto was actually like lunch -- returns were generated in minutes, there were tens of millions of successful examples that don't fail, and the insanely rare ones that fail in that mode risk double or low triple digit dollars -- then maybe the SEC wouldn't care as much.

Re: SEC charges Impact Theory for unregistered offering of NFTs

#38

Post by scyclow »

RC_ITR wrote: post #18
jermaustin1 wrote: post #7

The concept of NFTs stored on a distributed ledger makes sense to me especially for the shitty games that sell skins. The idea they have some sort of value and can be considered a security, doesn't really. It is no different than the current in-game marketplaces that sell/resell skins from whatever game has skins this week. At what point does a thing you buy or sell become a security? Are baseball cards a security? S…

This comes back to the core problem of crypto though - I agree that transferring skins would be cool or whatever, but distributed consensus does almost nothing to accomplish that. A game developer already has to opt-in to the NFT system and then maintain indefinite support for the NFT system, so if you trust them to do that why don’t you also trust them to maintain the ownership ledger?

I guess there are a few concerns here. What if the game developer goes out of business, or dies, or accidentally drops their db? What happens if they decide they don't like one of their collectors and want to wipe their balance clean? (Of course, you could do this with NFTs as well, but you'd have to write it into the contract ahead of time).

On top of that, the developer would need to build and operate their own infrastructure for trading with the tokens. If they were NFTs, then they just slot into existing applications without any extra work.

Re: SEC charges Impact Theory for unregistered offering of NFTs

#39

Post by jxf »

playday wrote: post #25
evilantnie wrote: post #20

Earlier quoted context omitted.

From what I'm reading here, the company misled "investors" by attaching the NFT to ownership in the company, which would be considered a security. "The order finds that Impact Theory encouraged potential investors to view the purchase of a Founder’s Key as an investment into the business, stating that investors would profit from their purchases if Impact Theory was successful in its efforts." When I purchase a baseba…

With baseball cards, You have an expectation that the MLB will continue to promote and develop Baseball as a top sport. You purchased an illegal security.

That seems materially different from an expectation that you will make money on the card, or that the value of your card is determined by MLB's profitability and future earnings.

Re: SEC charges Impact Theory for unregistered offering of NFTs

#40

Post by bigbillheck »

playday wrote: post #35

When you buy a restaurant lunch, you are expecting to increase your work income via the efforts of the cooks. And you clearly invested money since you pay for the lunch before you ate it. That’s all 3 prongs if the Howey test. Why isn’t the SEC enforcing securities laws against lunch fraud? Lunches must publish their financial statements so lunch buyers can make informed decisions! Personally I am angry that restaura…

> you are expecting to increase your work income via the efforts of the cooks.

Are you suggesting that retirees, the unemployed, students, and children never buy lunch?

> since you pay for the lunch before you ate it.

When was the last time you went to a restaurant that wasn't fast food?

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