The SEC strive's to name anything they can't control a security — Yankee tickets, NFTs, digital collectibles and even Bitcoin. The SEC wants to regulate digital assets and define them as securities. Is a JPEG of an ape a security? A WAV file of a song a security? It is a question digital web3 creators have had to fight against.
“OpenSea has received a Wells notice from the SEC threatening to sue us because they believe NFTs on our platform are securities. We're shocked the SEC would make such a sweeping move against creators and artists. — NFTs are fundamentally creative goods: art, collectibles, video game items, domain names, event tickets, and more. We should not regulate digital art in the same way we regulate collateralized debt obligations." — statement from OpenSea
Recently, one of the largest NFT marketplaces OpenSea became a target of an SEC probe. The idea of a JPEG or NFT being a security got under the skin of many crypto supporters, artists, musicians and creators in the web3 world. To make a point, one creator named @SolJakey minted an NFT out of a photo of SEC Chairman, Gary Gensler, claiming that now Gary is a security himself.
Gary may be a security, but he's not an asset. The classification of crypto is still yet undetermined and cryptocurrencies may be closer to being considered a security if people are buying them solely for monetary gain, but NFT art, music, pfp collections are non-security assets. NFTs are unique, decentralized digital collectibles and held as any other collectible like a painting or baseball card. Tokens or coins when separated from the contract may be considered non-securities. Time and debate will eventually resolve the crypto security arguments.
The future of crypto is being hammered out now and creators, marketplaces, and tokens each have their claims. But most importantly, Bitcoin is different in its decentralized protocol and a maximum supply of 21 million bitcoins. So finally, this last week we have multiple SEC officials and even Gary himself clearly stating the obvious — Bitcoin is not a security.
"I've developed a new open source P2P e-cash system called Bitcoin. It's completely decentralized, with no central server or trusted parties, because everything is based on crypto proof instead of trust." — Satoshi Nakamoto
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