What Is A Security According To The SEC For NFT?
The SEC (Securities and Exchange Commission) evaluates digital assets in the same manner as traditional assets to determine whether they are secure or not.
The Sec has not initiated any enforcement against the creator or operator of NFT. So NFT is security; this is unclear.
The definition of security is comprehensive according to the Sec. It does not explicitly include digital assets NFT as security.
Despite that, Sec has argued that offerings for digital assets are investment contracts. An investment contract is based on the test named as Howey test.
An investment contract is a contract, transaction, or scheme that involves:
• An investment of money.
• In the joint enterprise.
• Expectations of profit will be deprived of the efforts of a third party.
Only some of the NFTs can be considered a security, and the following points can see:
• If an NFT promises to return from the efforts of others, the NFT could be deemed as security.
Explore most asked questions and answers related to NFTs from here: Best Questions And Answers On NFT