Devin Finzer, CEO of the non-fungible token (NFT) marketplace OpenSea, has disclosed that the United States Securities and Exchange Commission (SEC) has issued a Wells notice to the company. This notice indicates a potential enforcement action over concerns that NFTs traded on OpenSea might be considered unregistered securities.
In a statement posted on X on August 28, Finzer expressed the company’s determination to contest any enforcement measures. He emphasized the broader implications such an action could have on the NFT industry, stating, “[T]his is a move into uncharted territory,” and warned that targeting NFTs could stifle innovation and adversely affect numerous online artists and creators who lack the resources to defend themselves.
“In addition to standing our own ground, we’re pledging $5M to help cover legal fees for NFT creators and devs that receive a Wells notice. Every creator, big or small, should be able to innovate without fear.”
The SEC has been active in sending Wells notices to various entities in the crypto and blockchain sector, signaling potential securities law violations. Despite a recent Supreme Court opinion that might restrict the SEC’s reach over crypto firms, the agency continues to investigate and act on such cases.
Regulating NFTs remains a contentious issue in the U.S. In July, a group of artists and creators sued the SEC, seeking clarity on whether their unregistered digital art could lead to enforcement actions. This lawsuit underscores the ongoing uncertainty and debate over how NFTs should be regulated.
