CyberKongz to Suffer in Silence No More, Takes Stand

CyberKongz recently announced on X (formerly known as Twitter) that it had received a Wells Notice from the SEC, signalling potential enforcement action.

The NFT collection criticised the SEC's approach, suggesting the agency is rushing to implement regulations before the end of the Biden administration.

A Wells Notice is a formal communication informing a company of the SEC staff's intention to recommend enforcement action, and CyberKongz anticipates being charged.

Expressing disappointment with the SEC's stance, the collection pledged to advocate for clearer regulations in the NFT space.

For the past two years, CyberKongz had remained silent in response to SEC inquiries, which included concerns about the combination of ERC-20 tokens with a blockchain game potentially classifying them as securities.

Additionally, the SEC had raised issues about CyberKongz's dealings with Genesis Kongz in April 2021, labelling it a "contract migration.”

It said:

“They cannot distinguish between a primary sale and a contract migration. What hope do we have for a clear regulatory pathway moving forward?”

Determined to address these challenges, CyberKongz is committed to pushing for more transparent crypto regulations, particularly for NFT projects.

CyberKongz Banking on Pro-Crypto Trump

CyberKongz has been outspoken in its criticism of the current administration's stance on cryptocurrency, which it views as anti-crypto.

Recently, as the US Senate Banking Committee prepared to vote on SEC Commissioner Caroline Crenshaw's renomination, lawyer Bill Hughes raised concerns over her position on crypto regulation, suggesting that her renomination could be seen as politically antagonistic toward the industry.

This contrasts with the growing momentum behind crypto-friendly policies under the incoming administration.

CyberKongz is hopeful that the new leadership will offer a more balanced and just regulatory framework.

In the interim, the team remains committed to supporting all NFT projects across blockchain platforms.

Over the past year, the SEC has pursued several high-profile cases involving NFTs, including lawsuits against Impact Theory and Stoner Cats 2 LLC for unregistered NFT offerings.

The commission also issued a Wells Notice to NFT marketplace OpenSea, signalling potential enforcement action.

With SEC Chairman Gary Gensler set to depart on 20 January, alongside the inauguration of President-elect Donald Trump, the future of crypto regulation remains uncertain.

Trump has appointed former SEC Commissioner Paul Atkins, a known ally of the crypto industry, to head the SEC, leaving many to await the implications of this transition.

In the meantime, CyberKongz has 30 days to file a response.