Commissioners including Hester Peirce oppose SEC enforcement action against NFT project Stoner Cats

Odaily Planet Daily News U.S. SEC Commissioners Hester Peirce and Mark Uyeda opposed the SEC’s enforcement action against the NFT project Stoner Cats 2 LLC (SC2). The two wrote: "We should develop some clear guidelines for artists and other creators who want to try NFTs to support their creative efforts and build their fan communities." The article points out that in some cases, the sale of NFTs may involve U.S. securities laws. However, in applying securities laws to this area, the SEC must be careful to preserve the ability of artists to sell their work, build a fan base, and engage that fan base in future creative activities. Yesterday, the U.S. SEC accused Stoner Cats 2 LLC (SC2) of conducting an unregistered crypto-asset securities issuance in the form of NFT, raising approximately US$8 million to fund an animated web series called Stoner. According to SEC filings, on July 27, 2021, SC2 sold more than 10,000 NFTs to investors at a price of approximately $800 each and sold out within 35 minutes. The filing notes that both before and after the Stoner Cats NFTs were sold to the public, SC2’s marketing campaign emphasized the specific benefits of owning them. SC2 sets a 2.5% royalty and encourages individuals to buy and sell NFTs.