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After more than three years, the U.S. Securities and Exchange Commission (SEC) has officially closed its investigation into Yuga Labs. This marks a significant victory not only for the company but also for the broader NFT market. The decision follows a string of other crypto-related cases that the SEC has recently dropped, signaling a potential shift in regulatory stance.
SEC Closes Investigation into Yuga Labs
Yuga Labs, the company behind some of the most iconic NFT collections such as Bored Ape Yacht Club (BAYC) and Mutant Ape Yacht Club (MAYC), announced on March 3rd that the SEC has officially ended its investigation.
In a statement on X (formerly Twitter), the company expressed its relief:
This is a huge win for NFTs and all creators pushing our ecosystem forward. NFTs are not securities.
The SEC had launched its investigation back in late 2022 to determine whether certain NFTs should be classified as securities. This was part of a broader regulatory crackdown led by former SEC Chairman Gary Gensler. The commission aimed to assess whether some NFTs, particularly fractionalized NFTs, should be regulated as securities under U.S. law, which would have imposed additional oversight and restrictions.
Yuga Labs has been a dominant force in the NFT industry. In addition to BAYC and MAYC, the company also owns the rights to CryptoPunks, one of the most valuable NFT collections in history, with individual pieces selling for record-breaking amounts.
Bored Apes and ApeCoin Struggle Despite the News
Despite the positive announcement, the market’s reaction was mixed.
The floor price (minimum sale price) of Bored Ape Yacht Club briefly surged to 13.75 ETH (around $29,650) following the news. However, by the end of the day, it closed 0.5% lower.
For context, at its peak in May 2022, a single Bored Ape was worth at least 153.7 ETH ($430,300). This means that, despite the legal victory, Bored Apes are still trading at over 90% below their all-time highs.
Similarly, ApeCoin (APE), the cryptocurrency launched by Yuga Labs, continues to struggle. The token is currently trading at around $0.54, reflecting a staggering 95% drop from its all-time high in 2022.
Is the SEC Softening Its Stance on Crypto?
The closure of the Yuga Labs investigation comes at a pivotal moment and suggests that the SEC may be easing its hardline approach to crypto regulation.
In late February, the SEC dropped its investigation into NFT marketplace OpenSea. Shortly after, a lawsuit against the major crypto exchange Coinbase was also withdrawn.
On March 3rd, the commission dismissed its case against Kraken, another high-profile crypto exchange.
This string of dropped cases hints at a possible shift in the SEC’s enforcement strategy, especially given that the Biden administration has historically taken a strict regulatory stance on crypto companies.
Conclusion: A Win for NFTs, but Market Sentiment Remains Cautious
While the SEC dropping its investigation into Yuga Labs is undoubtedly a major win for the NFT space, the broader market still faces challenges in recovering from the crypto winter.
NFT values, particularly Bored Apes and ApeCoin, remain far below their peak prices, and investor confidence is still fragile despite the improved regulatory outlook.
The key question now is whether the SEC’s recent moves signal a lasting change in crypto regulation—or if this is merely a temporary pause in enforcement actions.
One thing is certain: The NFT and crypto markets will be watching closely.
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