• In a move to shape the regulatory landscape, OpenSea is actively urging the US SEC to provide clear guidelines for NFT marketplace regulation.
  • Top legal voices at OpenSea, the General Counsel and Deputy General Counsel, have formally addressed SEC Commissioner Hester M. Peirce in a letter, seeking clarity on NFT marketplace rules.

The recent re-election of Donald Trump in the US has sparked significant developments for the crypto industry, with long-awaited regulation now a key topic of discussion nationwide. Lawmakers have already begun proposing legislation focused on creating crypto strategic reserves and regulating stablecoins. However, the specifics regarding NFTs and NFT marketplaces remain unaddressed.

As the leading NFT marketplace, OpenSea—a platform that played a pivotal role in the surge of NFT trading following the pandemic—is stepping forward to request official guidance from the US SEC on the regulation of NFTs and the marketplaces where they are traded.

Yesterday, OpenSea’s General Counsel and Deputy General Counsel officially communicated with the SEC Commissioner Hester M. Peirce by sending a letter outlining their perspective on NFT regulation. Their core argument is that NFT marketplaces should not be classified as security exchanges, and NFTs themselves should not be considered securities under current regulations.

OpenSea and NFT Marketplaces: Not Exchanges, Not Brokers

OpenSea positions itself as a digital marketplace, a space that effectively connects those looking to buy and sell NFTs. They contend that they don’t operate as an exchange under US securities laws because they function merely as facilitators, not intermediaries. Further, because the platform doesn’t offer investment advice or hold custody of user assets, OpenSea argues it also doesn’t fit the definition of a brokerage.

In their direct appeal to the SEC, the letter states:

“To resolve the current confusion within the industry, we respectfully ask the SEC to issue clear, informal guidance on this matter. Looking ahead, we propose that the Commission consider exempting NFT marketplaces like OpenSea from the proposed broker regulations.”

Interestingly, this push for NFT regulation comes just months after the SEC concluded investigations into several crypto firms, including OpenSea, this past February. The fact that OpenSea is now proactively seeking regulatory clarity after the conclusion of its investigation is a notable development.

Through this letter, OpenSea is advocating for the entire NFT ecosystem, urging the SEC to take action. With the US government already expressing interest in broader crypto regulation, it’s conceivable that OpenSea’s request could be seriously considered, potentially leading to NFT-specific regulations in the near future.

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