According to an internal corporate document obtained by Fortune, FLOW altcoin, Dapper Labs, a leading non-fungible token (NFT) company known for products like NBA Top Shot and CryptoKitties, was under investigation by the Securities and Exchange Commission (SEC) as recently as September.
Calling the document the “Case Closing Report,” the SEC filed a notice on Sept. 29 with “Dapper Labs, Inc.” He concluded an investigation titled. The one-page report did not disclose the reasons for the investigation, its start date, or the reasoning behind the SEC’s decision to close it.
“The SEC does not comment on the existence or absence of a possible investigation,” an agency spokesman said.
The decision to close the investigation into Dapper Labs, which has raised over $600 million since its first funding round in 2018, according to Crunchbase, follows the SEC’s settlements with Impact Theory in August and Stoner Cats in mid-September. These were the SEC’s first actions against the NFT industry, with the agency arguing that both NFT projects were offering and selling unregistered securities, thus violating federal law.
In a separate case, Dapper Labs is currently fighting a class-action lawsuit in which plaintiffs claim that NBA Top Shot Moments, NFTs sold by Dapper Labs, are unregistered securities. In February 2023, the federal judge overseeing the case refused to terminate the case, stating that it was “on its face reasonable” for Moments to be a security.
A spokesperson for Dapper Labs said, “We were never contacted by the SEC and as a result, we were unaware of this investigation. Despite everything, it appears that the SEC has closed the case.” said.
*This is not investment advice.
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