by Diontae Bussey | Sep 5, 2023 | Business News, Latest |
Image Credit: Photo by Andrey Metelev on Unsplash
The U.S. Securities and Exchange Commission (SEC) has stepped into the world of non-fungible tokens (NFTs), making its first enforcement action against a company in this space. The company in question is Impact Theory, a Los Angeles-based media company, which has been accused of selling unregistered securities in the form of NFTs. This case has sent ripples across the industry, providing insights into how NFTs could be regulated in the future.
The SEC’s Lawsuit: A Brief Overview
In a landmark move, the SEC is suing an NFT project, marking the first time the authority has taken enforcement action against a company for selling unregistered NFTs. The case revolves around Impact Theory, an LA media company that allegedly encouraged potential investors to view the purchase of their Founder’s Key NFT project as an investment into the business. The SEC order stated that the digital assets offered to investors were deemed “investment contracts” and therefore “securities.”
The Allegations
According to the SEC, Impact Theory “encouraged potential investors to view the purchase of Founder’s Key [the company’s NFT project] as an investment into the business, stating that investors would profit from their purchases if Impact Theory was successful in its efforts.” This, the SEC argues, means that the digital assets offered to investors were in effect “investment contracts” and therefore should be classified as “securities.”
The Settlement
Impact Theory neither admitted nor denied the SEC’s findings but agreed to pay more than $6.1 million in penalties to settle the allegations. The settlement also established a “Fair Fund” to compensate impacted investors. As part of the agreement, Impact Theory was required to destroy all of its Founder’s Key NFTs and eliminate any royalties it might collect from secondary market transactions.
Impact on the Crypto Industry
This case is significant to the crypto industry, which has been hit with a flurry of regulatory clampdowns in the U.S. It offers a clue for how NFTs could be regulated in the future, particularly as many other NFT projects have used language similar to how Impact Theory marketed its digital assets, touting their blockchain-based identifiers as investment opportunities.
Future Implications
Many other NFT projects have used language similar to how Impact Theory marketed its digital assets. These projects have touted their blockchain-based identifiers representing digital asset ownership as investment opportunities. The SEC’s action against Impact Theory could set a precedent for how these projects are regulated in the future.
Impact Theory’s Response
Despite the SEC’s allegations and subsequent settlement, Impact Theory is not giving up on its NFT endeavor. In a post, the founder of Impact Theory stressed that his company will ensure its future digital assets will be for utility rather than financial purposes.
The Founder’s Statement
“We will operate our go-forward business consistent with our good faith best understanding of all applicable laws, rules, and regulations. We will make clear that all of Impact Theory’s digital assets are collectibles with utility within the exciting new landscape of Borderless Entertainment. We will forcefully discourage people from treating our digital assets as anything other than what they are–collectibles with utility. We will have more news on this in the coming weeks and months.”
Conclusion
As the SEC’s first enforcement action against an NFT project, this case is a watershed moment in the crypto industry. It is a stark reminder of the regulatory complexities at play in this space and underscores the need for companies to ensure they are following all relevant laws, rules, and regulations. It remains to be seen how this case will impact the regulation of other NFT projects and the broader crypto industry in the future.
by Jonathan P-Wright | Aug 31, 2023 | Latest, Social Justice |
In the dynamic world of cryptocurrency, Tornado Cash has emerged as a prominent player. However, recent developments have put the company and its founders, Roman Storm and Roman Semenov, under scrutiny, leading to significant ramifications in the tech and legal spheres.
Founders Charged by U.S. Attorney’s Office
On a recent Wednesday, a statement from the U.S. Attorney’s Office for the Southern District of New York brought to light that the founders of Tornado Cash, Roman Storm, and Roman Semenov were officially charged1. They are accused of engaging in a conspiracy to commit money laundering, sanctions violations, and operating an unlicensed money transmitting business.
The Indictment
An indictment unveiled recently has brought these charges against the founders. Roman Storm has already been arrested in Washington, but Semenov is still at large according to the Southern District of New York (SDNY).
“Roman Storm and Roman Semenov in fact knew that they were helping hackers and fraudsters conceal the fruits of their crimes.” – U.S. Attorney Damian Williams
The Role of Tornado Cash
Tornado Cash, a platform established in 2019, is a cryptocurrency mixing service that provides users with the ability to conceal the origin of their crypto funds during transactions. This service, although beneficial to individuals seeking privacy, has also been utilized to render potentially tainted crypto funds less identifiable.
Decentralized Nature
During an interview with CoinDesk in January 2022, Semenov emphasized the decentralized nature of Tornado Cash. He mentioned that the protocol was specifically designed to be “unstoppable”. He also added that the team had little control over the protocol, thereby making it difficult for them to assist in investigations.
Legal Repercussions
The third co-founder of Tornado Cash, Alexey Pertsev, although not named in the recent indictment, is also facing legal consequences. Pertsev, who is based in Amsterdam, is being investigated for his role in the operations of Tornado Cash.
Money Laundering Allegations
Tornado Cash’s platform has allegedly been involved in transactions amounting to over $1 billion related to money laundering according to the SDNY. This includes over $455 million stolen by the Lazarus Group, a North Korean cybercrime organization, as per a statement from the U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) last year.
Sanctions by OFAC
In August 2022, Tornado Cash was sanctioned by OFAC for reportedly enabling over $7 billion in crypto to be laundered through its platform. From that point forward, U.S. citizens and businesses were prohibited from using its service.
Involvement of Other Agencies
Alongside the SDNY, the Federal Bureau of Investigation, the Justice Department, and the Internal Revenue Service’s Criminal Investigation unit have also been involved in the charges brought against the founders of Tornado Cash on Wednesday.
Conclusion
In conclusion, the charges brought against the founders of Tornado Cash underscore the ongoing scrutiny and regulatory challenges faced by businesses in the cryptocurrency sector. As this case unfolds, it will undoubtedly influence the legal and regulatory landscape for cryptocurrency businesses worldwide.
As we continue to monitor this situation, we remain committed to providing the latest tech news and updates regarding Tornado Cash and other significant developments in the cryptocurrency world. Stay tuned for more updates
by Derrick T Lewis | May 26, 2023 | Latest, Music News, New Music Alert |
A new collection of visuals by Juicy J is available, which are taken from his latest project, Mental Trillness. This past Friday (May 19), he released a clip for his song “Gettin‘.” The song was produced by Hitkidd and lets the hearer know what the Memphis musician has been up to.
This video was produced by Dang Films and Juicy J can be seen in a creepy looking mansion in the video. Throughout, he wears a mask, receives a drink from an attractive woman, and performs outside next to an old-fashioned convertible.
An 18-track album entitled Mental Trillness was released last March and features notable contributions from Aleza, K Carbon, La Chat, the late Gangsta Boo, Finesse2Tymes, and more. According to previous reports, Juicy J focused most of the album’s content on mental health, a cause he has acknowledged dealing with throughout his long and distinguished career.
This latest track from the Three 6 Mafia talent follows up a string of well-received 2022 projects, including Space Age Pimpin with Pi’erre Bourne, Crypto Business with Lex Luger & Trap-A-Holics, and Stoner Night with Wiz Khalifa. Among other things, he has also contributed to music such as Sauce Walka and Conway the Machine “Super Bowl,” Snoop Dogg and DJ Drama “Been Smokin,” and Megan Thee Stallion “Southside Royalty Freestyle.”
by Samantha J Rice | Mar 9, 2023 | Latest, Music News, New Music Alert |
At the moment, Rich The Kid is working steadily on the release of his next album, a project that is titled Life’s A Gamble, which will take place later this year. In the last few months, the Atlanta-based talent has delivered a number of fantastic singles that will appear on the upcoming album, namely “Where’s Dexter” by Jay Critch and Famous Dex, “Motion,” “No More Friends,” “Richard Mille Patek,” and “Boss B**ch,” “Prada” by Coi Leray.
On Friday, February 24th, the “Plug Walk” emcee added to what he already had going on with his latest track “Do You Love Me?” Produced by Mozz and Yoshi featuring Bronx’s own Lil Tjay as the featured artist, the track has one of the best verses to date from the rapper.
“Do You Love Me?” was also accompanied by an accompanying video made by Sebastian Beltran, as well. As you can see in the video, the two collaborators are able to relax and record music while they are in an unknown snow-filled location.
As it turns out, it’s been three years since Rich The Kid has released his last long-player, Boss Man, a highly anticipated 20-track record that features a slew of A-listers such as Future, Lil Baby, Nicki Minaj, Quavo, Post Malone, and more. As a result, Rich The Kid was chosen as a collaborator for the joint efforts Nobody Safe and Trust Fund Babies by Lil Wayne and YoungBoy Never Broke Again, respectively. As well as that, he also released a book of loose cuts and features in the form of his Lucky 7 EP, which included tracks like “Rocket Launcher” by Skillibeng, “Bussdown” by Headie One, and “Crypto” with Takeoff.
by Fabiola Noel | Jan 3, 2023 | Latest, Music News, New Music Alert |
Earlier this weekend, Rich The Kid revealed a brand-new track titled “No More Friends,” reported to be the first preview of Life’s A Gamble. Fly Guy Nick directed the music video, which shows the rapper enjoying a weekend of poolside parties and shopping sprees. The track features bars delivered over an instrumental produced by Painkid:
A number of tracks from this year featured Rich the Kid’s guest verses, such as “Crypto” created with Takeoff, “Holy Trinity” with Arizona Zervas, “Ballin (Kevin Durant)” with Reazy Renegade alongside K Camp, “Top Boy (Remix)” by Deej, and more. Among his most recent projects was Lil Wayne’s Trust Fund Babies from 2021. The project contained 10 songs featuring YG as the only guest appearance.
It was previously reported that the “New Freezer” rapper Rich the Kid had signed with RCA and shared some details regarding the deal. I received $40 million from RCA. We were lucky to have such a talented, solid team backing us up. Money isn’t the only thing that matters. Money is not always the most important issue. A brief interview with TMZ revealed he has signed with the best label in the business, RCA.
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