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The US Securities and Exchange Commission (SEC) has officially closed its investigation into Yuga Labs, the company behind the Bored Ape Yacht Club (BAYC) NFTs, without taking enforcement action.
The announcement signals a major shift in regulatory oversight of digital assets.
After 3+ years, the SEC has officially closed its investigation into Yuga Labs. This is a huge win for NFTs and all creators pushing our ecosystem forward. NFTs are not securities.
The probe, which began in October 2022, examined whether Yuga Labs’ NFT collections and ApeCoin (APE) should be classified as securities.
The decision to drop the case aligns with the SEC’s broader pattern of concluding cryptocurrency-related investigations in recent weeks.
This regulatory retreat follows years of scrutiny under former SEC Chair Gary Gensler, whose crackdown on digital assets led to enforcement actions against NFT marketplaces and tokenized assets.
NFT prices and market sentiment
Yuga Labs’ BAYC NFTs have suffered significant losses since their peak, with the floor price currently hovering around 13.75 ETH—down over 90% from its record high of 153.7 ETH in May 2022.
The SEC’s decision not to pursue charges is expected to boost investor confidence, potentially stabilising the NFT market, which has been hit hard by regulatory uncertainty.
Market sentiment had been largely negative in anticipation of possible enforcement actions against Yuga Labs. However, the closure of the case without penalties suggests a softening stance from regulators.
This shift could encourage renewed investment in blue-chip NFTs, including those from Yuga Labs and other major players in the space.
SEC’s changing stance on crypto enforcement
The conclusion of the Yuga Labs probe is part of a broader pattern of regulatory decisions that indicate the SEC is stepping back from aggressive legal action in the crypto sector.
Recent weeks have seen the agency settle litigation with major crypto firms like Coinbase and Kraken, while also closing investigations into OpenSea, Robinhood, Gemini, and Uniswap Labs.
The shift in approach coincides with the SEC’s announcement of the “Spring Sprint Toward Crypto Clarity” initiative, which aims to establish clearer regulations for digital assets.
The first public roundtable discussion, titled “How We Got Here and How We Get Out – Defining Security Status,” is scheduled for March 21.
These discussions could set the foundation for a new regulatory framework that moves away from strict enforcement toward structured guidance.
What this means for NFTs and ApeCoin
With the SEC dropping its case against Yuga Labs, questions remain about the future classification of NFTs and related tokens.
The debate over whether digital assets qualify as securities under the Howey Test is far from over, but this development suggests that NFT creators and investors may have more regulatory breathing room.
ApeCoin, the token tied to BAYC, has experienced volatility amid the SEC’s scrutiny but could see a resurgence in value following this decision.
The broader NFT ecosystem may also benefit, particularly if the SEC’s evolving stance leads to a more transparent and predictable regulatory environment.
While the SEC’s retreat provides short-term relief, the industry remains in flux as lawmakers and regulators worldwide continue to explore frameworks for NFTs and cryptocurrencies.
The next phase of discussions, particularly the upcoming SEC roundtables, will be crucial in shaping the long-term regulatory landscape for digital assets.
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