SEC Takes Aim at ‘Stoner Cats’ NFT Project, Alleges Unregistered Securities Violation
The U.S. Securities and Exchange Commission (SEC) has taken legal action against Stoner Cats, an NFT collection associated with actress Mila Kunis, deeming it an unregistered securities offering.
Stoner Cats had raised $8 million to fund an animated web series bearing the same name. The SEC’s charges stem from the NFT collection’s advertising campaign, which emphasized the opportunity for NFT owners to sell them on the secondary market and touted support from prominent Hollywood figures, giving investors the impression of potential profits. Gurbir S. Grewal, Director of the SEC’s Division of Enforcement, clarified that it’s the economic nature of the offering. Not its labels or underlying assets, that determines whether it’s considered an investment contract.
Stoner Cats has agreed to a $1 million penalty for these charges. This move follows the SEC’s previous charges against Impact Theory, another entertainment company, for offering unregistered securities in its NFT sales, highlighting the regulatory scrutiny around NFTs with promises of future financial gains.
Clever Robot News Desk 14th September 2023
