The U.S. regulator for securities, the SEC, has taken its first action against a company that sold non-fungible tokens (NFTs) without registering them as securities.
The company, Impact Theory, is a media and entertainment firm based in Los Angeles.
It launched an NFT project called “Founder’s Keys” in late 2021 and raised about US$30 million from hundreds of investors.
The SEC said that the NFTs sold by Impact Theory were investment contracts and securities, and that the company broke the law by not registering them.
Impact Theory agreed to stop selling the NFTs and pay more than US$6.1 million in fines and interest.
It also agreed to destroy any NFTs it still owns and give up any royalties it might get from the secondary markets.
Impact Theory did not admit or deny the SEC’s claims.