NFT marketplace OpenSea is asking U.S. regulators to clarify that it and platforms like it should not be treated as securities exchanges or brokers.
The request comes just months after the Securities and Exchange Commission (SEC) dropped a probe into the company’s alleged violation of federal securities laws.
In a letter dated April 9, OpenSea’s general counsel, Adele Faure, and deputy general counsel Laura Brookover urged SEC Commissioner Hester Peirce to issue informal guidance affirming that NFT marketplaces fall outside the scope of broker-dealer and exchange rules.
“Classifying OpenSea and similar NFT marketplaces as securities exchanges or brokers would be regulatory overreach,” they wrote.
OpenSea Says SEC Will End Investigation Into Ethereum NFT Marketplace
The SEC is ending its investigation into NFT marketplace OpenSea, co-founder and CEO Devin Finzer said late Friday, following Coinbase's announcement earlier in the day that the SEC intends to drop charges against the crypto exchange. "The SEC is closing its investigation into OpenSea. This is a win for everyone who is creating and building in our space," Finzer wrote on X. "Trying to classify NFTs as securities would have been a step backward—one that misinterprets the law and slows innovatio...
The company contends it doesn’t meet the legal definition of an exchange under U.S. securities laws because it doesn’t execute transactions or act as an intermediary.
OpenSea describes itself more as a digital bazaar than a trading floor, “allowing people to discover NFTs and connect with buyers and sellers” rather than facilitating trades in the traditional sense.
It also pushed back on the broker label, saying it doesn’t provide investment advice, negotiate deals, or custody customer assets. In the longer term, it has asked the Commission to exempt NFT marketplaces like OpenSea from proposed broker regulation.
The letter follows the SEC’s decision in February to shelve several high-profile investigations into crypto companies, including one into OpenSea.
Pudgy Penguins Solana Token, Ethereum NFTs Plunge Alongside Abstract Network Launch
Pudgy Penguins NFTs and PENGU, the ecosystem’s Solana token, have fallen sharply in the last 24 hours since its parent company launched Abstract, a consumer-focused Ethereum layer-2 network. PENGU has fallen 24% during that time and 49% in the last 30 days to $0.0173, dropping it outside the top 100 crypto assets by market cap according to CoinGecko. The Solana token has fallen to its lowest price since the volatile launch day in December. Meanwhile, the original Pudgy Penguins NFTs on Ethereum...
Those decisions came amid a broader policy pivot under Donald Trump that has embraced the crypto industry, though skeptics question whether the president is simply trying to enrich himself.
Despite Bitcoin’s record-breaking rally and the DeFi sector’s growth, NFTs have remained in the doldrums over the past couple of years.
In 2024, trading volumes and sales counts dropped to their weakest levels since 2020. Annual trading volumes fell by 19%, while sales were down by 18% compared to the year before.
Edited by Sebastian Sinclair
